Published on November 9th, 2017 | by Tim Dixon0
DiDi’s Huge Role In The Quickly Developing Chinese (& Global) Electric Car Ecosystem
November 9th, 2017 by Tim Dixon
Originally published on EV Obsession.
Didi Chuxing (China’s Uber-like ride-hailing service) has been in the news recently. It announced 1) plans to create its own electric car charging network, 2) a partnership with NEVS for one million electric self-driving cars, 3) that it’s a partner in Changan Automobile Group’s $15 billion Shangri La electric vehicle transition plan, and 4) that it has the world’s largest EV ridesharing fleet.
Why does this matter? While internal combustion vehicles are a well developed market with established relationships, the electric vehicle market is relatively new and we are seeing the development of the electric vehicles business ecosystem. This ecosystem will inform the shape and future key players in the market.
Didi Chuxing Market Position
While Uber is famous in America and Europe, Didi is the largest ride-hailing company in the world. Within China, it has a near monopoly on the ride-hailing market — it has more than 450 million users and 21 million drivers.
Didi is also backed by some major business interests within China, such as Tencent, Alipay, Alibaba, Apple, Baidu, and Chinese sovereign wealth fund. This position most likely aided Didi in its battle with Uber and will help it in future developments.
Didi and an Electric Future
Didi has proclaimed it already has 260,000 EVs in its network, out of the global total of 2 million EVs on the road. While this is impressive and makes Didi the largest EV fleet operator, the company does not intend to rest, with the CEO and co-founder Cheng Wei saying it will reach 1 million EVs by 2020.
The target of 1 million electric vehicles in Didi’s ride-hailing fleet leads us into another announcement by Didi and NEVS. The announcement of a new partnership will focus on developing an electric self-driving vehicle optimised for ride hailing. NEVS also aims to offer it present EV offering based on the original Saab 9-3 sedan to Didi and other companies. It already signed in 2015 an agreement to supply 150,000 EVs to Panda New Energy, an electric vehicle leasing company in China.
“NEVS have many years of solid innovation experience, based on the Saab heritage. We now combine this with the knowledge and the progressive mindset from an outstanding company like DiDi. It’s a perfect match that the whole ecosystem will benefit from,” said Kai Johan Jiang, Chairman of NEVS.
This idea of unifying electric vehicles, autonomous vehicles, and riding hailing into electric mobility has been a big trend in recent years and has offered more utopian dreams of ultimate private mobility than flying cars. It has come under attack as well as been supported for its ability to disrupt transport. People have pointed to how it negatively impacts public transport and leads to continued traffic and pollution problems. The tradeoff between benefits and costs is constantly up for debate.
Didi Seeks Shangri La
For Didi, the deal with NEVS is not the end of such deals. In my recent article about Changan Automobile Group’s $15 billion “Shangri La” electric vehicle transition plan, it was mentioned that Didi was a partner in building the new electric ecosystem. What I did not mention was that Changan has been developing self-driving cars. In 2016, the “Raeton” made a 1,200 mile journey from the southwest city of Chongqing to Beijing. These kinds of partnerships are building up the ecosystem capabilities of the companies allowing them to better develop and compete in the modern economy.
Charging in the Concrete Jungle
Didi has recently announced plans to create an EV charging network. Co-founder and CEO Cheng Wei, speaking at a sustainable energy conference, said: “We have started new joint venture projects to build our own EV charging systems. DiDi’s charging networks will not only cover our own fleet. It will also serve families and the public.” A partner in this joint venture is Global Energy Interconnection Development and Cooperation Organisation (GEIDCO), which jointly sponsored the sustainable energy conference with the United Nations.
The design of this charging network is as yet unknown, but in China, due to the constraints of a 2D road system and 3D housing system — due to high density of residential towers in cities and the pressures they put on personal parking — it might be similar to the large inner-city charging and parking areas I have noticed in Chinese cities. Hopefully Didi will go into more details in the future and produce a detailed roadmap.
In recent years we have had much discussion of the future of mobility in our global society, Didi CEO outlines a vision shared by many people:
“The future of transport is new energy vehicles, and ridesharing will be a key link in promoting new energy on the road,” said Cheng.
The future of electric vehicles stands not on a single company’s heroic effort but the development of a strong business ecosystem that will sustain and create innovation. As we strive to understand the future of vehicles, we must seek to understand the whole global electric vehicle ecosystem and not just parts of the picture.
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