DRIVE A2B May 2018

FRANCE -
Uber loses
EU court case
France is entitled to bring
criminal proceedings
against local managers
of ride-hailing app Uber
for running an illegal taxi
service, the EU top court
ruled last month.
Uber’s loss follows an earlier
one last year where the
Luxembourg-based Court
of Justice of the European
Union (ECJ) classified the
company as a transport
service rather than a digital
one, which stripped it of
protections against undue
national regulation that
digital services enjoy under
EU law.
The latest case concerned
Uber’s use of unlicensed
drivers as part of its
UberPOP service in France,
which has since been
suspended there and in
several other cities. Uber
still uses its service with
professional licensed drivers
in France, which is not
affected by the ruling.
Uber has also been forced
to quit countries such as
Denmark and Hungary.
MEXICO - Uber to go head-to-head
with Didi again!
by Johana Bhuiyan
In August 2016, Uber sold its China
assets to its primary competitor
in the country, Didi Chuxing, and
ended a costly subsidy battle that
was on its way to slowly bleeding
the company dry. That was the last
time Uber and Didi faced off headto-head
in a ground war.
But Didi isn’t done with Uber. The
Chinese ride-hail player has just
launched its service in Mexico,
which happens to be an Uber
stronghold.
While Didi has been fighting proxy
battles against Uber around the
world through its investments in
multiple international competitors
like Ola in India; Careem in the
Middle East; Taxify in Europe and
Africa; and via its acquisition of
Brazil’s 99, this will be the first time
Didi will be actively battling the
U.S.-based ride-hail player outside
of China.
It’s a significant move for Didi,
which has quietly sought world
domination, and one that several
sources internally say has given
Uber a cause for concern. Didi is
going after Uber in a market where
it will hurt.
Uber’s struggles with profitability in
places like the U.S. and Southeast
Asia are well documented, but the
company has managed to become
profitable in Mexico as Latin
America has quickly rocketed to
becoming the company’s fastestgrowing
region.
Didi, which has been recruiting
drivers in Mexico since early April,
had already taken the first steps
to infringe on Uber’s stronghold
in Latin America through its
acquisition of 99 in Brazil.
While local competitors across the
region continued to battle Uber
outside of Mexico, few were willing
to take the risk of trying to undercut
the well-resourced U.S. company in
Mexico — including 99.
Complicating matters is Didi’s
investment in Taxify, which already
operates in Mexico. But now Taxify,
which has only raised $2.2 million
to date, will be facing off against
both Didi and Uber.
For Uber — which has been
whittling down its international
footprint in an effort to cut
losses — its decision to pull out of
Southeast Asia and sell its assets
to competitor Grab leaves room for
the company to focus on important
markets like Latin America as well
as the Middle East and India. In that
way, Uber and Didi’s international
strategies look more similar than
ever: they operate on the ground
in some major markets while
investing in local players in others.
In a few short years, Mexico has
become Uber’s third-largest country
market — behind Brazil and the
U.S. — with seven million riders and
250,000 drivers.
But fighting Didi off is no easy task.
With a total of around $20 billion in
funding as of December 2017 and
the backing of Chinese sovereign
wealth funds like China Investment
Corporation, Didi is one of the few
companies that can engage in
and possibly win a subsidy battle
against Uber.
DRIVE A2B magazine · May 2018 33