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BusinessDidi’s Car-Sharing Arm Reportedly Goes Bankrupt

Didi’s Car-Sharing Arm Reportedly Goes Bankrupt

On the evening of July 25, a screenshot related to Didi’s ongoing bankruptcy audit was leaked by an accounting firm employee. On Chinese social media platform Weibo, a user suspected of being a Didi employee confirmed that the firm’s car-sharing business is going into liquidation. The news comes as Didi’s autonomous driving business, which is heavily associated with its car-sharing venture, is undergoing mass layoffs.

According to domestic business data platform Tianyancha, the “Didi Car-Sharing” trademark belongs to Beijing Didi Unlimited Technology Development Co., Ltd., whose legal representative is Didi CEO Will Cheng.

Didi’s car-sharing arm offers travel services based on the “Internet of Vehicles” within the Didi Chuxing app. Users can pick up, use and return vehicles through the app or at offline operating sites.

Didi’s vehicle-sharing business has had great expectations. Cheng said in November 2020 that sharing is the optimal solution for daily travel in the future. Buying services will eventually replace buying tools, he says, allowing people to have a better travel experience without owning a car. The proportion of travel by shared means in China and even globally has an opportunity to grow from 3% now to 30% by 2030.

Cheng predicted that more than 1 million shared cars equipped with autonomous driving functions are expected to be available on Didi’s platform by 2025, while upgraded versions of shared cars in the future will be capable of carrying Didi’s own autonomous driving modules. “By 2030, we hope to get rid of the cockpit and be fully autonomous,” Cheng added.

However, Didi has been in trouble since its listing to the New York Stock Exchange in June 2021. In July, The Cyberspace Administration of China (CAC) ordered app stores to remove Didi, citing violations by the company’s collection and usage of personal information. The regulator also asked Didi to rectify such problems. Didi’s app is still not available online.

On July 21, 2022, Didi was fined 8.026 billion yuan ($1.19 billion) by the CAC due to its alleged violation of China’s Network Security Law, Data Security Law, Personal Information Protection Law, and Administrative Penalties Law. Will Cheng, and Jean Liu, the company’s president, were each fined 1 million yuan ($147,900). Pandaily previously reported that Jean Liu is set to leave the company.

At the time of publication, Didi had not yet responded regarding its car-sharing arm’s reported bankruptcy.

SourcePandaily
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