CBI member, BMW has obtained a license to provide ride-hailing services in Chengdu, the capital city of Sichuan province. The granting of the license is a coup for the German automobile manufacturer, since it is the first foreign marque to obtain permission.
The company announced on Wednesday that it had established a subsidiary called BMW Mobility Services earlier this year to obtain the license and run BMW’s ride sharing arm.
China’s ride-sharing industry is big business. The market is already worth $30bn and is expected to grow to $72bn by 2020. However, it is currently dominated by Didi Chuxing, the Beijing-based ride-hailing app company, which enjoys over 90% market share.
Nonetheless, foreign car manufacturers have recently begun to increase their interest in the market after Didi suffered a public relations and regulatory crisis following the murder of two passengers using their service.
The scandal has given foreign car manufacturers a rare sense of opportunity within the ride-sharing space. For example, off the back of the Didi scandal, Daimler and Geely also announced a ride-sharing partnership earlier this year. Their partnership revolves around a joint venture, however, and is not yet ready to be launched.
Joseph Patterson, the head of BMW Mobility Services has announced that he hopes BMW’s own ride-sharing venture will be up and running before the end of the year.
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