China’s growing mobility solutions provider DiDi Chuxing announced earlier this month a $1 billion investment in Xiaoju Automotive Solutions, which provides financial loan and lease products for DiDi’s ride-hailing drivers.
Xiaoju was incubated by DiDi starting in 2015 and the mobility solutions provider began using it on a trial basis in April to facilitate loans, leases, gas refueling, auto maintenance, and carshare services.
“We hope our drivers take advantage of DiDi’s financial packages that include outstanding and flexible financing, leasing, and insurance services,” a company spokeswoman told AFN in an email. “With these services, we aim to provide reasonable and affordable car ownership options for our drivers, especially younger drivers who may not be able to afford one otherwise.”
Many drivers avoid used-cars in China because there’s a lack of reliable history reports and consumers are afraid they’ll purchase a “lemon.” While DiDi offers financing to own the vehicle in its entirety, the company is also exploring new forms of shared ownership that allow drivers to swap cars more frequently.
“In this new era of shared mobility services, the car-ownership lifecycle is evolving,” the spokeswoman wrote. “DiDi’s multi-model rideshare ecosystem makes it easier for drivers to turn their vehicles over after a couple of years, which DiDi can then repurpose.
This cycle makes more sense and reduces transaction costs.” DiDi completes over 30 million rides per day, across 14 verticals including taxis, private cars, commuter ridesharing, bikes, and buses. The company operates in over 800 towns and counties across China.