Apple invests $1B in China’s largest ride-hailing company Didi
Apple has invested US$1 billion in China’s largest ride-hailing company, Didi Chuxing, in a move that could give it an opportunity to participate in the local company’s bid to build a data-driven ride-share platform.
Apple has been indicating that such an investment was coming for some time now, said Patrick Moorhead, president and principal analyst at Moor Insights & Strategy. The company has already said that it plans to increase its services revenue and that the Chinese market is a key component of its overall strategy going forward, Moorhead said.
Didi, which is already backed by big local players like Tencent and Alibaba, said it has raised the Apple investment as a part of its latest funding round. The investment by Apple is the largest single investment Didi has ever received, it added.
CEO Tim Cook said recently the company would invest in mergers and acquisitions to boost its various businesses, including services.
China is already the second largest market by revenue for Apple, though revenue fell 11 percent from this market in the last quarter.
The Chinese company has teamed with other players to form an alliance to counter the growing influence of Uber Technologies. Didi announced in September last year a $100 million investment in Lyft, which would allow Lyft users visiting China to access Didi services from their native apps. Didi has also invested in regional players like India’s Ola and Malaysia’s GrabTaxi.
There has been speculation previously that Apple would get into self-driving cars. A partnership with Didi could give Apple an opportunity to sell its technology in 5 to 10 years to the ride-hailing company, as it and its rivals like Uber transition to autonomous cars, Moorhead said.
The investment, which would use the large amount of funds Apple holds overseas, would also give it a prominent place on the table in China’s transportation industry, he added.
The company is a big player in China, and completes over 11 million rides a day on its platform, serving close to 300 million users across over 400 Chinese cities, with a wide range of mobile technology-based transportation options.