On Wednesday (8th), Lu Media reported that sources revealed that Didi’s community e-commerce company, Orange Heart Youyou, will lay off all employees in preparation for the package sales department. In addition to Orange Heart, Didi’s other community e-commerce brands are also layoffs and stop related businesses. This means that Didi may completely abandon its community e-commerce business after a year.
Currently, the main companies operating community group buying in China are Meituan (3690-HK), Pinduoduo (PDD-US) and Alibaba (9988-HK), and the outside world believes that Didi’s exit will benefit the e-commerce platform that has already deployed community group buying. . The Chinese government is strengthening supervision and prohibiting the industry from burning money to expand, which may make it more difficult for new players to catch up with leading companies.
The market is temporarily interpreting this news with profit. The outside world believes that if Didi forcefully enters the community e-commerce to fight a price war, it may not be detrimental to its own stable operation, and Didi’s US stocks closed up 7% on Tuesday.
In addition, as Didi’s new competitors are gradually pressing, Cao Cao Chuxing, a Chinese online ride-hailing platform under Geely Group, announced the completion of a Series B financing with an amount of RMB 3.8 billion. The investors in this round are Suzhou Xiangcheng Financial Holding Group, Suzhou High-speed Rail New City State Control Group, Suzhou Urban Investment Company, ABCI Suzhou Company, and Soochow Innovation Capital, many of which are state-owned enterprises.
At the same time, Cao Cao Travel said that its national headquarters will be located in Suzhou City. Cao Cao said that this round of financing is the first domestic equity investment obtained by the online car-hailing industry this year, and it is also the largest single financing in China by an online car-hailing company since 2020. It seems that Cao Cao Chuxing intends to use Didi to grab Didi’s market share when it is being supervised by the Chinese government.
A recent research conducted by the China Research Institute of Puhua Industry Research on China’s online car-hailing industry shows that Didi has a market share of more than 90% and is firmly ranked as the leader in China’s online car-hailing market; the first car and Cao Cao travel are ranked respectively Second and third, the market share was 3.96% and 2.96% respectively.
