Daimler mulling Geely partnership for Chinese ride hailing, report says
The goal of the partnership would be to compete with Didi Chuxing.
Didi Chuxing is the current ride-hailing leader in China, and it's quite the major player, so it would take some sort of corporate Voltron in order to compete in that space. That's exactly what two big automakers are attempting to create, according to a new report.
Daimler (parent company of Mercedes-Benz ) and Geely (parent company of Volvo ) are in talks to create a ride-hailing joint venture, Bloomberg reports, citing sources familiar with the matter. The goal of this 50-50 joint venture would be to offer ride-hailing services to compete with Didi Chuxing in China.
According to Bloomberg's sources, the discussion is still ongoing and nothing is set in stone just yet. Representatives for Geely did not immediately return a request for comment, but both companies declined to comment to Bloomberg, and Daimler also declined comment to Roadshow.
Daimler would likely rely on vehicles produced under Chinese joint-venture projects for its ride-hailing service, including electric vehicles.
The timing is right to bring the fight to Didi Chuxing's doorstep. The company has been hit with some major setbacks in recent months. In August, the company had to shutter its carpooling service after a female passenger was assaulted and murdered. In September, the company put its late-night services on a one-week hiatus as part of an overhaul of the company's safety policies.
This isn't the first time Geely and Daimler have ended up in the same headline. In February, it was first rumored that Geely sought a $9 billion stake in Daimler, and it turned out that Geely's chairman had been building that stake in stealth. A subsequent report from April rumored that Daimler might lend its engines to future Volvo vehicles, but we haven't seen anything real come from that corner of the rumor mill just yet.
Both companies have also made moves into the mobility space, albeit separately. Bloomberg points out that Geely already has a ride-hailing app called Caocao that works in two-dozen Chinese cities and promises access to over 20,000 electric vehicles. Daimler has its Car2Go car-sharing service, which recently expanded to Chicago as Daimler attempts to capture larger swaths of the US market.
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