Alibaba, Tencent, Suning, and car makers including Chongqing Changan Automobile have set up a $1.5 billion Chinese ride-hailing venture.
Chongqing Changan Automobile said that it has invested 1.6 billion yuan ($238.36 million) in the Nanjing-based investment company alongside partners such as the investment units of Alibaba, Tencent and retailer Suning.Com Co Ltd, and automakers FAW and Dongfeng Motor.
China is home to the world’s largest ride-hailing market, estimated by consulting firm Bain & Co to be worth $23 billion. Of that, Didi Chuxing takes 90 per cent of all bookings
However, a swathe of car makers, from BMW, Geely to SAIC as well as other tech firms such as Meituan Dianping have also launched their own mobility services in a bid to grab a share of the fast-growing market.
Didi, which is backed by Japan’s SoftBank Group Corp and Uber Technologies, also has joint ventures with BAIC and Volkswagen.
Changan said that itself, Dongfeng and FAW will each have a 15 per cent stake in the joint venture, which will set up a ride-sharing company with a focus on new energy vehicles.
Suning will be the biggest shareholder with a 19 per cent stake while Alibaba and Tencent’s investment units will together hold the remaining shares with some other funds, it added.
The new ride-hailing company and its investors, which come from a range of fields, will help form “business synergies which will help enrich the companies’ ecosystems”, Suning said in a statement.
FAW and Dongfeng confirmed the venture while Alibaba and Tencent declined to comment beyond the Changan statement. Didi declined to comment.
