Chinese electric carmaker Xpeng the latest to jump into ride-hailing despite ongoing losses at market leader Didi – South China Morning Post
What happened: Electric vehicle (EV) maker Xiaopeng is preparing to take on Didi as it enters China’s competitive ride-hailing sector. The company was granted an operating license by Guangzhou authorities on Monday and began advertising jobs for fleet operators and mobility operations specialists on its website in March. Xiaopeng declined to comment on its timetable or expected fleet size, according to the South China Morning Post.
Why it’s important: Entering the ride-hailing market would put Xiaopeng up against market leader Didi, which has been losing money on many of its trips. The company said it was pocketing 19% of each fare in China, two percentage points lower than the cost of the trip. Ride-hailing operators have also seen increased scrutiny over the past year following two high profile murders of passengers using Didi’s carpooling service. Nonetheless, Xiaopeng could be looking for an additional revenue stream as the government cuts its EV subsidies nationwide, putting increased pressure on manufacturers as they either absorb the extra costs or pass them on to their customers.