Lyft is using a partnership strategy in China and that's a wise route to go.
Lyft Inc. is teaming up with China’s Didi Kuaidi to create a bigger competitor to ride-hailing company, Uber Technologies Inc.
Didi Kuaidi, the largest car-sharing company in China, said it had invested $100 million in Lyft as part of an already disclosed funding round that valued the San Francisco-based startup at $2.5 billion. The two companies will share technology and product development teams, they said during a presentation Wednesday in New York.
Didi Kuaidi and Lyft, the second-biggest U.S. ride-hailing company, have fought fiercely with Uber, which is valued at $50 billion and operates in more than 340 international cities. Beginning early next year, Lyft users will be able to summon a car for the first time in China using their Lyft app and Didi Kuaidi users will be able to hail a ride in the U.S., John Zimmer, Lyft’s co-founder and president, said Wednesday during a presentation in New York.
“We have strong faith in Lyft’s future in the U.S. market,” Jean Liu, president of Didi Kuaidi, said at the event.
Lyft signaled this strategy months ago, saying that it would likely grow internationally through local partnerships. Uber meanwhile has committed $1 billion to establishing itself in China and a similar sum to compete in India.
Didi Kuaidi works with more than 1.35 million taxi drivers, 2 million private car drivers and 1 million chauffeurs in China and has been used by more than 200 million people, the company said in a statement. More than half of Lyft’s rides in San Francisco and in New York take place on Lyft Line, the company’s carpooling service.
“From our home base in China, Didi Kuaidi is building China’s largest one-stop, on-demand, transportation service platform,” Cheng Wei, CEO of Didi Kuaidi, said in the statement. “As the industry innovation leader, Lyft will continue to build upon its existing market and brand power.”
To contact the reporters on this story: Eric Newcomer in San Francisco at firstname.lastname@example.org; Jing Cao in New York at email@example.com To contact the editors responsible for this story: Jillian Ward at firstname.lastname@example.org Andrew Pollack, Cecile Daurat
This article was written by ERIC NEWCOMER and Jing Cao from Bloomberg and was legally licensed through the NewsCred publisher network.
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Photo Credit: Lyft is entering China through a partnership with Didi Kuaidi. Pictured are Lyft driver Chauncey and passenger Kevin in the U.S. in August. Lyft