In a few Whatsapp groups of tech/startup practitioners and aficionados, people have been sharing about this potentially big threat to Didi – T3.
If you have not heard about it (and/or wondering what the heck it is), read the following TechCrunch story:
The story gathered more attention in English than in Chinese. We know that anything that has the backing of Alibaba and Tencent will fare well in the news – however, it is also important to understand what is behind the news.
And we think T3 is more of a defensive move (and to certain extent PR), without any material threat to Didi:
- T3 is led by three state-owned car manufacturers. We think for them this is more of a bargaining chip they want to build to gain a better negotiating position when working with Didi, rather than wanting to challenge Didi.
- Alibaba and Tencent are only small minority stakeholders – for them this is probably more of a political stance rather than financial or strategic investment
- As a loose alliance – operational wise it will be challenging, and we believe the partners know about it.
- It started in the city of Nanjing with 5000 cars – a smaller fleet than many taxi companies in China.
- Also, the alliance was actually formed last year. What they did recently is a press release introducing more partners and stakeholders.