Chinese ride-hailing giant Didi is facing increased scrutiny from authorities and the public alike following an incident in Shanghai on Thursday involving a Didi driver fleeing to avoid the police, injuring three pedestrians and a police officer.
Shanghai police determined that the driver surnamed Hao was not eligible to work for the ride-hailing service in Shanghai, which requires a Shanghai identification card. Didi will be fined RMB 100,000 (around $14,400) for slack management, according to an announcement released Friday by Shanghai Municipal Transportation Commission.
Shanghai regulators ordered Didi to remove all ineligible drivers by the end of June. The Shanghai authorities also warned of legal action should more unqualified drivers be caught.
Didi later responded in a Weibo announcement that it was “actively” assisting the police investigation of the driver.
The ride-hailing giant reversed an initial refusal to allow authorities complete access to its data including drivers and rides in late 2018, following the high-profile murders of two female passengers by Didi drivers. Wang Fumin, an official with the Transport Department in southern Guangdong province, said publicly in late August that a crackdown on unqualified drivers was hindered by withheld access to data.
Chinese media reported in August that more than 5,000 non-compliant drivers were actively accepting rides on Didi’s ride-hailing platform in the southern Chinese city of Shenzhen, and 10,000 were found in neighboring city Dongguan. The company later pledged to ensure compliance on its platform, saying it removed 140,000 fraudulent driver accounts from its platform last year.
Didi has also faced ride shortages following tightened driver requirements. It posted huge losses as competition increased with lifestyle mega-app Meituan, which began offering ride-hailing service in late 2017, and Ant Financial-backed Hellobike, which launched a year later.
Hellobike has expanded into 81 cities and Meituan into 39. Both players adopted an aggregate model, offering third-party ride-sharing services on their apps.
Didi ultimately decided to follow a similar path, introducing a ride-sharing service Miaozou owned by online travel agency Tongcheng to users beginning in May in the southwestern city of Chengdu. The move is expected to supplement the number of rides available on the platform while offering passengers affordable and reliable rides, Didi said in an announcement sent to TechNode on Monday.