Tech giant invests $1 billion in Chinese ride-sharing service Didi

sQuashie

May 13, 2016 1:34 PM

This latest investment will solidify the mobile phone makers place in China, which is its second market, and signals a move towards transportation just like other major rivals.

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Didi, as it is popularly known, is described as a transportation network company that uses an online-enabled platform to connect passengers to taxis and personal vehicles for a fee.

According to Apple’s chief executive officer, Tim Cook, this large investment was for “a number of strategic reasons, including a chance to learn more about certain segments of the China market.”

Last month, the technology giant recorded a fall in profits in its second quarter revenue for the first time since 2003 after a slump in the sale of iPhones. Much of this was attributed to low sales in China.

Technology giants diversifying into transport is gradually becoming popular notably, , which is working on driverless cars.

Didi claims to arrange over 11 million rides every day across the world’s third largest country and is said to have about 85% of the market share. Apple’s investment is expected to further deepen the woes of Didi’s rival, Uberfrom the United States which has so far failed to break into the Chinese market.

Other major players in the multi-billion dollar ride and taxi-hailing economy include Lyft, BlaBlaCar and Turo. The attraction of these services for users is convenience and lower fares.

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