The ride-hailing service space seems to be getting crowded with each passing day and new players are trying their best make their presence felt in this space which is ruled by a handful of players. Didi has been the dominant force in the car-hailing space in China and its success has led many new players to dip their toes in this new arena. One such challenger is T3, the short form of ‘Top 3’, which has been officially launched after a dozen entities, including three major automakers, joined hands to shell out a total of 9.76 billion yuan ($1.45 billion) for the venture. The initial agreement for the joint venture was reached in July last year, according to a report by TechCrunch.
As per the report, the investors’ list has got some really big names with the country’s largest internet companies, Alibaba and Tencent leading the way. The big chunk of the cash is expected to be used by the joint venture to develop car-sharing services powered by renewable energy which fits nicely in the scheme of things with Beijing’s push to electrify the transportation sector.
This latest venture marks the coming together of the private and public sectors to inject some life and innovation in the clunky public sector and is being dubbed as the ‘mixed reform’. As per the official announcement, T3 will be purely market-driven and will try to build a ‘smartmobility ecosystem’ which will combine the data capability of its technology partners with the manufacturing know-how of its automakers.
The role of both Alibaba and Tencent who are rivals on many fronts remains secondary in this venture as Suning is set to be the largest shareholder by acquiring 17.42 percent equity. Automakers FAW Group, Dongfeng Motor, and Changan Automobile will each pick up 16.39 percent of the new entity as the second-largest holders. The remaining shares will be distributed equally between Tencent, Alibaba and rest of the affiliates.
T3 believes that a fleet of 5000 cars will start running on the streets of Nanjin by May or early June. This development has come as a blow for Didi which is still reeling from the effects of two murders which forced it to beef up the security measures.