Hello TransTech Takes On Didi Chuxing In China Ride-Hailing

Hello TransTech, the Chinese ride-hailing startup formerly known as Hellobike, is launching a carpooling service this week, on the heels of a test that ran for roughly a month.

According to reports, the entrance of Hello into China’s carpooling market pits it against Didi Chuxing, the leading ride-hailing company, which – under the direction of the government – has halted its service over safety concerns.

While Hello might be late to the country’s ride-hailing marketplace, it has deep-pocketed investors, including Ant Financial, the payments affiliate of Alibaba, China’s leading eCommerce company. When Hello initially started as a bike rental startup, Ant Financial sent business its way, reported the newswire.

For Alibaba, the backing of Hello is part of the company’s strategy to compete in the marketplace by offering on-demand rides, and to apply its asset-light platform to another market in China. The report noted that it is not clear if the strategy will be effective for the Chinese eCommerce giant. Didi Chuxing has the lead, with 66 million unique devices on its app as of December, compared to the 6.3 million unique devices connected to Hello’s service.

In addition to investing in technology startups, Alibaba has also set its sight on the physical retail market. Earlier this month, Reuters reported that the company was interested in acquiring a stake in the Chinese wholesale operations of Metro AG, the German operator of cash and carry stores. Metro has 95 stores in China, as well as retail operations in Beijing and Shanghai. The two have already partnered in online retail in the country.

Alibaba is operating in an uncertain marketplace in China. For the last three months of 2018, it reported results that were below top-line expectations, but was able to beat on the bottom line. The company was able to grow in terms of user count and other metrics, despite the economic slowdown.