Didi Dache called out over ‘illegal’ private-car features in Wuhan

According to Sina Tech, the Chinese taxi and private car app Didi Dache has been asked by Wuhan’s taxi management office to “clean up” its operations in the central Chinese city, including its operation of Uber-style private cars, which the authorities view as illegal, unregistered “black taxis.”

Didi has responded that it is already in talks with Wuhan’s Ministry of Transit, including discussions of its private-car operations. But the company maintains that its private car fleet is rental cars, and that they serve the interests of both users and the city, and thus shouldn’t be legislated out of existence.

It may not be as dramatic as the recent police raids on Uber offices in two different Chinese cities, but the disagreement in Wuhan underscores the problem that apps like Uber and Didi are having in cities all across China: registered taxis are generally the only small passenger vehicles legally permitted to take fares in the manner of a taxi. Whether or not that should still be the case is up for debate all across the country, but the apps face stiff competition from the entrenched local taxi industries, which are threatened by private-car services.

Where Chinese authorities will eventually come down on the issue is still very unclear. Authorities have not been hesitant to make it clear that at present, private-car services are illegal. Moreover, the country’s Minister of Transport has said that private cars will never be allowed to operate commercially. Despite that, though, there are signs that authorities recognize the improved efficiency offered by these apps. Now that the market is being dominated by a domestic company (Didi Kuaidi), they may be less hesitant to empower it than they might have been had the private-car app winner in China been a foreign app like Uber. And the fact that there hasn’t been a more serious, long-term nationwide crackdown on any private-car app yet indicates that authorities are still mulling their options.

Didi Kuaidi would likely survive even the grimmest potential outcome – an enforced ban on private-car apps – because it also helps users to take conventional taxis. Uber and other private-car-only apps would not be so lucky.

(Source: Sina Tech)