DiDi's SA drive opens up e-hailing landscape
The ride-hailing industry is about to enter a new phase in SA as the world's second- largest provider of app-booked rides expands into the country's economic heartland.Last week, China-headquartered DiDi Chuxing (which translates as "Beep-beep! Mobility") - a company valued at $50bn (R712bn) and with 550-million users - opened driver registration in Johannesburg and Pretoria. It has offered a R250 sign-up bonus, R300 per driver and rider referral, and zero commission deducted for the first four weeks.The move comes after a quiet launch in Gqeberha in March, and a more high-profile arrival in Cape Town in May, with airport billboards underlining its anticipated core customer base.It will now compete nationwide with Uber's 13,000 and Bolt's 25,000-plus drivers. Ironically, DiDi is also an investor in Bolt and Uber globally, while Uber has a stake in DiDi after selling its Chinese operation to the newcomer.The ride-hailing industry is in the midst of a rapid recovery as it woos the market with giveaway deals. On Monday, Uber offered some of its regular customers 50% off their next 10 rides for the week. The next day Bolt went one better, offering 70% off. However, the discounts also underlined the desperate measures being taken to get back to business as usual.Frans Hiemstra, general manager for Uber in Sub-Saharan Africa, told Business Times that the initial level 5 lockdown in SA and similar iterations across the region were a challenge that demanded "all hands on deck during those early days"."We needed to respect government restrictions while we looked to innovate and outline opportunities and solutions for our business, as well as our drivers and delivery drivers and our restaurant partners. This also presented us with a unique opportunity to look at other ways we can help businesses and riders move what matters," he said."For example, we partnered with the Bill & Melinda Gates Foundation to deliver chronic medication to vulnerable patients and SA Harvest to feed communities. This ensured drivers could continue moving while earning. We also adapted our technology to offer a customer-to-customer delivery option called Uber Connect to respond to consumer needs of staying connected with family and friends."This month, Uber announced a partnership with the department of health and the department of basic education to cover trips for 300,000 eligible educators to and from vaccination centres.Gareth Taylor, regional manager of Bolt in Southern Africa, said Bolt also adapted by offering a number of interventions and new product categories, such as the Bolt Go low-cost service, Bolt Isolated Cars, and Bolt Women Only, "to keep drivers driving, and passengers getting to their destinations safely and cost-efficiently"."We have already expanded to all towns and cities in South Africa with a population of at least 100,000 people. Our goal now is to provide even more opportunities in our existing areas of operations for drivers and passengers to benefit from our platform," Taylor said.Like Uber before it, Bolt embraced food deliveries as an expansion strategy and a means of keeping drivers going during lockdown. According to James Townsend-Rose, country manager of Bolt Food SA, the division has been growing at a rate of 50% a month since its launch in April 2020. "This was a challenging time, as restaurateurs were rightly focused on managing their businesses through a very difficult time and were understandably reluctant to initiate new partnerships," he said."However, over time, we have shown the restaurant owners and managers the value that we can bring, and we're proud of the rate at which we're securing new partnerships with restaurants. Our pricing strategy is central to our value proposition - we offer the best value to customers, whether those customers are restaurants or consumers."Most significantly, he said, "Bolt Food provides courier partners with an additional, flexible opportunity to earn an income". More than 2,500 of these couriers are registered on the platform.This all means DiDi is entering a highly competitive market that has innovated to overcome the impact of Covid-19. Felipe Contreras, of the DiDi global communications team, believes that this still leaves room for a major new player. "We believe that mobility should be accessible to everyone," he said. "Especially in the context of the pandemic, access to convenient, safe and accessible economic opportunities is more urgent than ever in the country."Since launching in Gqeberha and Cape Town, he said, "thousands of drivers have already signed up for driving with the DiDi Driver app, enabling more than tens of thousands of local residents to get to where they need to be, safely and affordably. Given that even our most optimistic expectations were exceeded in both cities, we hope that our arrival in Gauteng will be equally successful and allow us to position ourselves as a real alternative for users and entrepreneurs."DiDi's launch in smaller centres allowed it to study the market and gain a better understanding of its needs, he said."We studied the mobility of Gqeberha and Cape Town for months. Our team puts all its energy into preparing and adjusting our platform for each city where we start operations and, once we feel satisfied with the operation for both users and drivers, we take the next step to the next phase of our expansion in the country. "We've also come to learn that mobility is particularly sensitive to the cultural characteristics of each region. People travel for different reasons and in different forms in each city, country and region of the world."