Ride-hailing app, Uber, has a serious competitor emerging after reports that Chinese firm, Didi Chuxing, are set to begin operations in Mexico. According to sources, they are also believed to be considering an Initial Public Offering (IPO).
Didi Chuxing received a $4 billion investment in December to help it expand out of China and the firm have gone from strength-to-strength in 2018. Already offering its services in Japan, Brazil and Taiwan, a move to Mexico will renew the rivalry that reportedly forced Uber out of the Chinese market.
Latin America potential
There are in excess of 70 million internet users in Mexico and Latin American is said to be the world’s third-largest ride-hailing market, behind the USA and China.
Mexico is one of the jewels in the Uber crown, with operations covering more than 40 cities. However, the launch of Didi Chuxing’s Express service in the city of Toluca could be followed by an expansion across numerous other cities throughout the Central American country.
A Didi Chuxing spokesperson explained:
“The market is way from saturated and we are glad to see the local market is not only very welcome to more services but they also understand how beneficial competition in the region is for the final user.”
With expansion now covering Japan, Brazil, Taiwan and Mexico, Didi Chuxing explained:
“We’re exploring every possibility of expanding our business in the international market. When doing so, we will work with leading local partners in some markets and look for opportunities in others to build a robust local team with strong commitment to the region.”
Initial Public Offering
According to the Wall Street Journal, Didi Chuxing, are considering an Initial Public Offering (IPO) that could see the company’s value rocket to $80 billion; a sharp rise from December’s $50 billion valuation. With Uber expected to launch its own IPO in early-2019, Didi Chuxing, could steal a march on their US rivals with a late-2018 float.
What are your thoughts, should Uber be worried?