China’s largest ride-hailing platform Didi Chuxing has launched a new intra-city errand service in two Chinese cities on Monday, local media LatePost reported.
Photo credit: Didi
The new errand service promises to deliver everything from groceries, beverages, medicines, and even flowers within a city, with a starting rate of 12 yuan (US$1.72) for the first four kilometers, 20 yuan for a delivery distance of four to 10 kilometers, and 30 yuan for a distance higher than 10 kilometers.
Didi piloted the service in Chengdu and Hangzhou, with drivers from the firm’s dedicated service Didi Chauffeur as the first batch of errand runners. The service will be launched in more cities, and Didi will start recruiting new employees soon, the firm told KrAsia.
Didi added that its errand service will become an additional income source for Didi Chauffeur’s drivers. Its dedicated driver business, which provides qualified drivers to car owners, has been hit heavily amid the coronavirus outbreak, as people are reluctant to go outside or drive their own cars.
As many as 11.4 billion express deliveries were completed in China in 2018, up 23% from the previous year, according to the State Post Bureau, which regulates the country’s postal service provider, China Post. That translates to a market worth 90.5 billion yuan (US$12.7 billion).
Food delivery giants such as Meituan Dianping and Ele.me have already tapped into this fast-growing market before Didi. Meituan, China’s largest on-demand services platform, tapped its takeout delivery fleet to offer an intra-city errand service from March 2017. Its main rival, Alibaba’s Ele.me, followed suit a month later.
For intra-city deliveries in Hangzhou, Meituan charges 8 yuan as a starting rate, going up 1 yuan per kilometer within six kilometers and 2 yuan for deliveries from six to 100 kilometers away. In contrast, Ele.me has a starting rate of 10 yuan in Hangzhou but does not specify its pricing rules for delivery radius. These companies all have different prices, depending on the city.
Didi has already tested the waters in China’s on-demand sector. It made a foray into food delivery services in April 2018 with a pilot launch in Wuxi, Jiangsu. However, the company halted domestic food delivery expansion several months later, when it had to manage a big crisis after multiple sexual assaults and murders occurred in Didi’s carpooling service.
Recently, the company announced plans to officially launch a food delivery service in Japan starting from April, challenging Uber Eats – the service provided by its main rival in the Japanese market, Uber Technologies – KrAsia reported.
Currency converted from yuan to US dollar: US$1 = 6.95 yuan.
This report was first published on KrAsia.
Editing by Miguel Cordon
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