Mobility

Alibaba’s AutoNavi Map App Launches Ride-Hailing Aggregation Platform To Rival Didi

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AutoNavi Software Co., Ltd., a Chinese mapping app acquired by Alibaba Group Holding Ltd. in 2014, has launched a ride-hailing aggregation platform to compete with Didi and other ride-hailing services in China.

The move follows AutoNavi’s launch of its own carpooling operations in February, and is a more direct assault to Chinese ride-hailing services including Didi Chuxing, Ucar Inc and Shouqi Limousine & Chauffeur.

AutoNavi, also known as Gaode Map and currently has 700 million users, is operating a ride-hailing services aggregation platform, instead of launching its own ride-hailing services. Users of AutoNavi will be able to see and choose from a list of options when requesting a ride. AutoNavi is offering generous subsidies currently in order to acquire more users.

The move for Alibaba to enter the ride-hailing space is expected as the Chinese e-commerce giant strives to deepen its relationships with users. Alibaba’s Ant Financial, together with its partners, have 870 million annual active users at the end of March, 2018, according to Alibaba’s earning reports. Even though Alibaba owns around 6% of Chinese ride-hailing leader Didi Chuxing, it has become increasingly clear that Didi Chuxing has its own ambitions to become a dominant force in Chinese technology.

Obtaining market share in ride-hailing will serve significant strategic value to Alibaba, as this provides another avenue where Alibaba’s mobile payment services can be used with high frequency. Access to massive user data will prove useful to Alibaba as it attempts to understand its users better to provide more personalized services.

Alibaba’s move into ride-hailing follows a strategy that is dear to the company. Similar to its e-commerce platform Taobao, AutoNavi’s ride-hailing aggregation services provide a platform where the providers of a service are matched with demand. This is how Alibaba built up its logistics alliances as well, where instead of operating its own logistics unit, Alibaba created Cainiao Network to aggregate almost all major express delivery services onto its own technology back-end platform.

In 2017, China’s Groupon equivalent Meituan-Dianping rolled out its own ride-sharing service, but that attempt has been progressing slowly due to complicated local regulatory challenges. How AutoNavi encounters these challenges will determine if its foray into ride-hailing will produce more satisfactory outcome.

 


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