Ride-hailing platform Xiangdao Chuxing has scored RMB 300 million (USD 46 million) from strategic investors Alibaba (NYSE: BABA) and electric battery maker CATL in its Series A round, the company announced on its website.
Wu Bing, CEO of Xiangdao, told 36Kr that it will cooperate with Alibaba in data technology, AI, and map navigation, where the e-commerce giant has leading advantages, and with CATL in electric vehicles which are widely used in the ride-hailing sector.
“This is a reasonable cross-sector investment for Alibaba and CATL,” Zhang Xiang, an auto analyst with a think tank focused on new energy and connected vehicles and affiliated with the Ministry of Industry and Information Technology, told KrASIA on Monday.
Xiangdao, launched by automaker SAIC Motor in December 2018, has been available in cities including Shanghai, Zhengzhou, Suzhou, Kunshan, Hangzhou, Ningbo, Shaoxing, and Wuxi, garnering more than 10 million registered users by August, according to SAIC’s website.
Despite the growth, Xiangdao is still dwarfed by Didi, China’s largest ride-hailing platform, which reported over 400 million monthly active users in October in China. Teaming with BYD, Didi also launched a tailor-made EV model D1 for ride-hailing drivers in November, KrASIA reported.
“Didi cannot eat up the whole ride-hailing market,” said Zhang, adding that Didi’s market share has been declining in recent years.
Alibaba’s investment into Xiangdao comes after the company in late November poured cash into high-end electric vehicle maker Zhiji Motor, together with SAIC Motor and Shanghai Pudong New Area, in a 10 billion yuan (USD 1.52 billion) financing round, according to SAIC Motor.
The e-commerce giant established a strategic cooperation with SAIC as early as 2014, and co-launched Roewe RX5, a sports utility vehicle (SUV) featuring Alibaba’s operating system YunOS, in 2016.
The two companies deepened their strategic cooperation in 2019, covering areas including ride-hailing, autonomous driving, and cloud computing, Banma Network, a joint venture of Alibaba and SAIC, posted on its WeChat account on August 28 last year.