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Three of China’s largest automakers—FAW Group, Dongfeng, and Chongqing Changan—have launched a joint ride-hailing platform, reports Reuters. The platform, called T3 Mobile Travel Services, is one of the most aggressive attempts by automakers to date to enter the ride-hailing business.
While relatively unknown in the United States, the partners account for a large chunk of sales in their home country, the world’s largest new-car market. All three are also state owned, and have joint ventures with foreign automakers due to rules requiring non-Chinese firms to partner with local firms in order to produce cars in the country.
The plan calls for bringing in additional partners from outside the auto industry to help develop the ride-hailing service, according to Reuters, and the three Chinese automakers hope to integrate self-driving car technology, should that technology become widely available.
China’s ride-hailing market is dominated by local firm Didi Chuxing. It bought Uber’s Chinese operations in 2016, eliminating the main source of competition. In February, Didi signed a memorandum of understanding with the Renault-Nissan-Mitsubishi Alliance regarding an electric car-sharing service. The company is also rumored to be discussing a possible collaboration with Volkswagen.
Chinese automakers aren’t the only ones teaming up on mobility services. BMW and Daimler recently announced their own partnership that will see the old rivals co-develop a variety of services. BMW and Daimler currently hold stakes in multiple small ride-hailing companies, and operate their own car-sharing services. BMW is launching a ride-hailing service in Seattle under its ReachNow brand as well.
Ride hailing has been dominated by tech companies like Uber, Didi, and Lyft, and presents a potential threat to automakers because it reduces dependence on private cars. But it also presents an opportunity, in the form of a new revenue stream beyond car sales, so automakers will likely continue to explore ride-hailing and other mobility services.
