Can Uber succeed in China?

The rivalry is definitely heating up. Just as Uber raised $1.2 billion for its Chinese operations, its domestic rival Didi Kuaidi is set to raise $3 billion through its latest fundraising round. Both companies are keen on dominating China’s Internet-linked transport market and both are backed by powerful investors. Uber has the support of China’s Internet giant Baidu, while Didi Kuaidi is backed by Alibaba, Tencent as well as sovereign wealth fund, China Investment Corporation (CIC). At first glance, it seems Didi Kuaidi already has the upper hand, being a local player and enjoying the support of the Chinese government through CIC. Uber, on the other hand, is not about to play second fiddle. The company announced that it’s building a strong local team so it can assimilate culturally and administratively into China. It also claims it has a market share of 30% to 35%, a significant growth from 1% at the beginning of 2015. Now the question in everyone’s mind is, can Uber dominate the Chinese market? After all, the Chinese government has always favored local startups to foreign companies and there’s a chance that Uber will eventually be muscled out by its local competitor, just like what happened to eBay and Yahoo, which both failed to gain traction in China.
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