Beijing/Shanghai: Deep-pocketed Chinese rivals and tough regulators stand in the way of U.S. car-hailing service Uber`s plans to conquer one of the world`s biggest transportation markets, even after it signed a tieup with domestic internet giant Baidu Inc.
The terms of a deal that sees Baidu buy a stake in the fast-growing taxi app operator were not disclosed.
Uber, though, is a comparative latecomer in China, where taxi app users are set to triple to 45 million by 2015 compared with 2013, according to Chinese research firm iResearch. Domestic firm Kuaidi Dache and Didi Dache, backed by tech giants Alibaba Group Holding Ltd and Tencent Holdings Ltd respectively, have 90 percent of the market sewn up.
"China is the Holy Grail because it is both elusive and attractive at the same time," said Kumar Saha, an automotive and transport analyst at Frost & Sullivan.
Uber does have a presence in mainland China already, but it`s tiny, with operations in just eight cities. By contrast, Kuaidi is already in over 350 cities, while rival Didi recently raised $700 million to fund expansion.
"You have to do things differently in order to succeed here in China," Uber Chief Executive Travis Kalanick said in Beijing, making his first public appearance since a rape case involving a driver in India that resulted in an Uber ban in New Delhi. Kalanick declined to discuss the India situation or its impact on company policy in other markets like China.
