Shouqi Limousine & Chauffeur, a ride-hailing service backed by state-owned transport company Shouqi Group, expects to make a profit by the end of this year, CEO Wei Dong said on Wednesday.
Why it matters: If Shouqi’s forecast holds true, China’s second largest ride-hailing service may be the first in the industry to break even.
- Global ride-hailing giants, including Didi, Uber, and Lyft, are struggling to turn their popularity into profits. Lyft reported losses amounting to $911 million in 2018, while Didi reportedly suffered a loss of nearly RMB 10.9 billion (around $1.48 billion) during the same period.
- Shouqi secured RMB 600 million in a Series B in late 2017, followed by another RMB 700 million led by Baidu and Nio Capital, an investment firm founded by Chinese EV maker Nio.
Details: Shouqi is already profitable in Shanghai and Shenzhen, and its businesses in cities including Beijing and Guangzhou are nearing a break-even point, Wei said Wednesday in a letter sent to employees.
- The company attributed the achievement to its high-end positioning and quality services. It says it is China’s second-largest player with more than 53 million registered users in upwards of 70 domestic cities. All the drivers on its platform which services cities including Beijing and Nanjing are regulation-compliant, Wei added.
- Shouqi ranked a distant second with 3.3 million monthly active users in the Chinese ride-hailing market, followed by Geely-backed carpooling service Caocao with 2.5 million users, and Uber with around 960,000 as of end-May, recent figures from market research firm Analysys show. Didi dominates the market with 75.2 million active users.
