China’s tech giants race ahead with new ride-hailing offerings as Didi stumbles

A number of Big Tech companies – including on-demand delivery platform operator Meituan, telecoms equipment giant Huawei Technologies Co, and Tencent Holdings’ WeChat – have been investing heavily in the field, hoping to carve out a foothold in a market where Didi once controlled a share of more than 90 per cent.

The heated race has translated into hefty discounts for customers across the country. In the financial centre of Shanghai, a ride that would have cost as much as 40 yuan (US$5.93) on Didi last year now costs around 25 yuan on both Didi and Meituan.

This month, Meituan is giving out one-time coupons to Shanghai residents that waive any fare within 20 yuan – usually enough to cover a 3 to 4km ride in the downtown area.

The company is also handing out priority passes that promise to help users hail a ride in less than three minutes amid the summer heat. To achieve that, the Beijing-based firm said it has set up a special office in Shanghai and is hiring operation experts dedicated to ensuring that customers have timely access to cars.

The company has also waived commission fees for drivers during peak hours, which would help them earn 30 per cent more on average, according to a press release.

China’s ride-hailing market has changed drastically over the past year, as competitors eat into Didi’s existing and potential customer base, said Zhang Yi, chief executive of market research firm iiMedia.