The importance of the Chinese market has gone unnoticed by no one, and certainly not by Uber. The car service company is extending its quest for industry domination by spending staggering amounts in China, with Uber reportedly paying its drivers more than what they earn during their trips. But with the sheer volume of untapped potential that comes in the form of China’s enormous population and growing capital, this strategy may be worth it. Already, according to the New York Times, 10 percent of all Uber rides that occur daily are in China.
Late last month, the company claimed that its spending spree in China had created 60,000 new jobs in the country. And even if some of those are moonlighting jobs, with the company offering bonuses of up to three times that of actual trip fares, some part-time drivers may be tempted to quit their day jobs.
Jacky, a 34-year-old Uber driver in Shanghai, told the Times, “This is a really great opportunity for me to make some extra money.” In just three weeks, he managed to make $1,000, about half the amount he makes at his day job as a systems analyst at a telecommunications company. And the service seems great for passengers too, with prices around 35 percent cheaper than taxis, friendlier drivers, and of course, the occasional free bottled water.
That being said, some are suspicious that the high reported volume of drivers, passengers, and rides being logged in China are something of a hoax. Various reports claim that some drivers have been reporting fake journeys and signing up for multiple accounts in order to qualify for Uber’s big bonuses.
Separate from the question of whether Uber’s numbers are legitimate, the car service faces some major domestic competition. Didi Kuaidi claims 90 percent of the market and will be loathe to give up any of its turf, especially to a foreign company. At a recent media briefing, Jean Liu, Didi Kuaidi’s president, told reporters, “We welcome all good competition. This is our home market; we love this market so much, we want to make sure it grows in a healthy, sustainable, safe way.”
Only time will tell just how this market grows, and how much if it Uber will be able to claim.
