Apple has made an investment of $1 billion in Didi Chuxing, which is the counterpart of Uber in China. Ahead of the Apple CEO’s high-profile visit to the Asian country later in the month of May, Mr. Tim Cook stated that the mentioned investment would open opportunities to partner with Didi Chuxing. This statement had triggered speculation that Apple Inc. will make a strategic investment, which goes well with its plan to develop a new electric car.
According to Mr. Cook, “We are making the investment for a number of strategic reasons, including a chance to learn more about certain segments of the China market.”
“Of course, we believe it will deliver a strong return for our invested capital over time as well,” he further added.
Tim Cook has recognized the electric car project of the Cupertino, California-based tech giant, which the Tesla CEO Mr. Elon Musk described as an “an open secret.” Apple has hired expert designers and engineers from other corporations, such as Tesla, GM, and Ford in order to help with this project. Based on a public documentation, the iPhone maker has been searching for testing locations.
The only public car product of Apple Inc. is the CarPlay system. This system connects Apple devices to the entertainment system of the vehicle.
The Apple CEO pointed out that, “That is what we do today in the car business, so we will have to see what the future holds.”
Electric and autonomous vehicles are a hot topic in the automobile and technology sphere, with major competitors such as Tesla, Google, Apple and other rivals striving to develop innovative technologies and products.
Currently, ride-hailing corporations depend on independent human drivers. These drivers’ status as contractors has led to a string of legal disputes, especially for Uber, around employment law and regulation. Driverless technologies would not only eliminate these issues, but also enable taxi-hailing companies to turn its focus on managing complex and profitable data about the movement of people in cities, and the opportunities to earn that by operating a fleet of autonomous vehicles.
Didi Chuxing is the leading player in the private ride-hailing market in China, and claims to have approximately 300 million customers in 400 cities across the Asian nation who take 11m rides each day. According to the Founder and CEO of Didi Chuxing Cheng Wei indicated in a statement that the investment of the Cupertino, California-based tech firm marks the single largest investment of the iPhone maker so far.
Furthermore, the Chinese ride-hailing company also claims that it is responsible for about 87 percent of the ride-hailing market in the Asian country, in which the US-based ride-hailing service Uber is attempting to enter. Based on Uber’s last funding round in the month of December last year, the service is valued at $62.5 billion. A funding round in the month of February this year valued the Chinese ride-hailing service at $20 billion.
Apple’s books and film services were recently shut down by the Chinese government only 6 months after the launch. The device sales in the country are still increasing, but greatly slowed together with the economy of China.