In just five years, Didi Chuxing has attracted $20.6 billion in funding - including a $500 million injection from Booking Holdings last month.
As the Chinese ride-hail services gauges its next move, it's turning its attention - and funds - to its automobile services business to support for its fleet of drivers.
Didi Chuxing is going pedal to the metal for its automobile services business after it announced it will invest $1 billion into the division, which is also getting a rebrand.
The Chinese ride-hailing firm had been tipped to spin out the business and raise $1.5 billion from investors ahead of an IPO, according to a recent Reuters report. The business itself hasn’t spun out, however, but it has been renamed to Xiaoju Automobile Solutions and given more autonomy with the introduction of its own general manager.
The division handles services for registered Didi drivers, such as leasing and purchase financing, insurance, repairs, refueling, car-sharing and more. Essentially, with its huge army of drivers, Didi can get preferential rates from service providers, which means better deals for its drivers.
That, in turn, is helpful for recruiting new drivers and growing the business. (Didi claims to support 30 million drivers, but that covers food delivery as well as more basic point-to-point transportation.)