Uber is growing like a weed in China, spending millions of dollars to push into the country. And it’s just getting started.
The San Francisco-based ride-hailing service said it was starting a new carpooling service, beginning in Chengdu, China, on Wednesday morning. The service, called UberCommute, gives Chinese car owners who drive long distances — most likely drivers heading to and from work — the option of picking up passengers going in the same direction. The drivers and riders share the cost of the trip, which means the drivers end up saving money on a journey they would have already made by themselves.
“When people can push a button and get a ride in minutes, they are less likely to drive themselves,” Uber said in a blog post. “Instead of 30 people using their own cars, you have one car serving them all.”
The new service, which Uber plans to introduce globally over time, shows how the company is focused on gaining mainstream popularity in China, the world’s largest Internet market. Uber, which has raised about $7 billion in funding, has earmarked more than $1 billion for growth in Asia.
The introduction of UberCommute comes on the eve of the Chinese president Xi Jinping’s meetings with business leaders in Seattle on Wednesday. China’s Internet czar, Lu Wei, is holding an Internet forum on Wednesday that many of the top American technology companies — such as Apple, IBM and Uber — are expected to attend. The meetings have rankled the Obama administration because the gatherings show that China has sway with American business leaders, even though China’s policies do not align with Washington’s.
China is an obvious place for Uber to offer the new service. The world’s most populous country is known for gridlocked traffic and crowded mass-transit systems.
Uber may also be looking to the new service to ratchet up the competition with a local Chinese rival. Didi Kuaidi, China’s dominant ride-hailing start-up, also recently began offering a carpooling service aimed at commuters.
Didi Kuaidi, which has a more than 80 percent market share in China, lets customers choose between shuttle, bus or private car services, among other options in its highly popular app. This month, Didi Kuaidi announced a partnership with Lyft, Uber’s main ride-hailing rival in the United States, which will let Lyft users from the United States find rides in China using the Lyft app and Didi Kuaidi users find rides in the United States using the Chinese app.
Commuter-related services are popping up elsewhere with technology companies. Waze, the mapping company owned and operated by Google, is experimenting with a carpooling service in Israel, though the company has not announced a wide introduction of the program. BlaBlaCar, a ride-sharing competitor valued at $1.6 billion, operates a similar carpool-like service in markets including Europe, India and Russia.