BEIJING: Apple said it has invested $1 billion in Chinese ride hailing app Didi Chuxing, the bitter rival of US-based Uber, as the tech giant seeks to better understand its second-biggest market.
The announcement comes as Apple faces headwinds in China, where it has seen huge drops in sales of its popular electronics, but is working to expand its mobile payments service and is even believed to have ambitions for driverless cars.
Didi, formerly known as Didi Kuaidi, is China’s largest ridesharing service, and the tie up may serve as a way for Apple to get to know the Chinese market ahead of a long-rumored expansion into the transportation sector.
“We decided to make the investment for a number of strategic reasons, including the chance to learn more about certain segments of the China market,” CEO Tim Cook told Xinhua.
Apple is thought to be one of a number of tech companies, including Google and Chinese search giant Baidu, that are developing driverless cars.
The move may also be intended to help Apple expand its Apple Pay service, which faces strong Chinese competition, analysts said.
The twin prospects may help soothe investors nervous about Apple’s prospects in the Middle Kingdom.
The company’s shares have dropped more than 13 percent since April 26, when it reported its first ever fall in iPhone sales, largely due to waning interest from Chinese consumers.
On Thursday, the stock closed down 2.4 percent, losing its coveted spot as the world’s biggest publicly traded company to Google parent company Alphabet.
The fall from grace, blamed on the company’s failure to expand into the lower-priced handsets popular in developing markets, came amid a string of bad news from China.
Last month, authorities shut down Apple’s movie and book services. Adding insult to injury, it was revealed to have lost a court case over the use of its iPhone trademark.
Hoping for a turnaround, Cook will travel to Beijing later this month to lobby senior leaders.
Didi, which also has backing from Chinese Internet behemoths Tencent and Alibaba, likely hopes to use the deal to strike a death blow to US-based Uber, its main competitor for the Chinese ridesharing market.
Apple’s injection was the “single largest investment the company has ever received,” said Didi, which dominates the car-hailing sector in China and says it has almost 90 percent of the market.
Uber, which has received funding from Baidu, along with state-owned Citic Securities — is a small, but scrappy competitor.
Didi and Uber both have deep pockets and have been locked in a war of attrition for riders.
In February, Uber said it lost $1 billion annually in China as it competes for market share and Didi is thought to be dropping similar amounts as both companies subsidise users’ rides, which are much cheaper than regular cab fares.
Last September, Didi’s president Jean Liu said the company was “burning through cash,” according to a report by Bloomberg News.
Though Apple’s investment in Didi is large, the deal seems more notable for its strategic rather than financial significance.
There are “lots of opportunities for closer cooperation between the two companies,” Cook told Xinhua.
One area they are likely to explore is mobile payments, according to Chinese analysts who say the investment could be a good opportunity for Apple Pay.
The service was recently launched in China but has to contend with well established existing competitors owned by Alibaba and Tencent — now its fellow shareholders in Didi.
Didi says it has more than 300 million passengers registered and provides over 11 million rides a day — numbers that provide an excellent opportunity for Apple Pay, according to an article on Chinese web site Huxiu.
“It is undoubtedly a good value for Apple to tie up with an app that has a large user base and where frequent payments are made,” it said.
It is technically illegal in China for private cars to offer rides for payment, and authorities occasionally stage stings to arrest drivers, but regulations are not often enforced, creating an opening for ridesharing services to flourish.
Didi invested in Uber’s US rival Lyft last year, along with Alibaba and Tencent, and announced last month that it would cooperate with it to compete with Uber on its own turf.
Apple invests $1bn in taxi app Didi
Apple invests $1bn in taxi app Didi
Saudi investment pipeline active as reforms advance, says Pakistan minister
ALULA: Pakistan’s Finance Minister Mohammed Aurangzeb described Saudi Arabia as a “longstanding partner” and emphasized the importance of sustainable, mutually beneficial cooperation, particularly in key economic sectors.
Speaking to Arab News on the sidelines of the AlUla Conference for Emerging Market Economies, Aurangzeb said the relationship between Pakistan and Saudi Arabia remains resilient despite global geopolitical tensions.
“The Kingdom has been a longstanding partner of Pakistan for the longest time, and we are very grateful for how we have been supported through thick and thin, through rough patches and, even now that we have achieved macroeconomic stability, I think we are now well positioned for growth.”
Aurangzeb said the partnership has facilitated investment across several sectors, including minerals and mining, information technology, agriculture, and tourism. He cited an active pipeline of Saudi investments, including Wafi’s entry into Pakistan’s downstream oil and gas sector.
“The Kingdom has been very public about their appetite for the country, and the sectors are minerals and mining, IT, agriculture, tourism; and there are already investments which have come in. For example, Wafi came in (in terms of downstream oil and gas stations). There’s a very active pipeline.”
He said private sector activity is driving growth in these areas, while government-to-government cooperation is focused mainly on infrastructure development.
Acknowledging longstanding investor concerns related to bureaucracy and delays, Aurangzeb said Pakistan has made progress over the past two years through structural reforms and fiscal discipline, alongside efforts to improve the business environment.
“The last two years we have worked very hard in terms of structural reforms, in terms of what I call getting the basic hygiene right, in terms of the fiscal situation, the current economic situation (…) in terms of all those areas of getting the basic hygiene in a good place.”
Aurangzeb highlighted mining and refining as key areas of engagement, including discussions around the Reko Diq project, while stressing that talks with Saudi investors extend beyond individual ventures.
“From my perspective, it’s not just about one mine, the discussions will continue with the Saudi investors on a number of these areas.”
He also pointed to growing cooperation in the IT sector, particularly in artificial intelligence, noting that several Pakistani tech firms are already in discussions with Saudi counterparts or have established offices in the Kingdom.
Referring to recent talks with Saudi Minister of Economy and Planning Faisal Alibrahim, Aurangzeb said Pakistan’s large freelance workforce presents opportunities for deeper collaboration, provided skills development keeps pace with demand.
“I was just with (Saudi) minister of economy and planning, and he was specifically referring to the Pakistani tech talent, and he is absolutely right. We have the third-largest freelancer population in the world, and what we need to do is to ensure that we upscale, rescale, upgrade them.”
Aurangzeb also cited opportunities to benefit from Saudi Arabia’s experience in the energy sector and noted continued cooperation in defense production.
Looking ahead, he said Pakistan aims to recalibrate its relationship with Saudi Arabia toward trade and investment rather than reliance on aid.
“Our prime minister has been very clear that we want to move this entire discussion as we go forward from aid and support to trade and investment.”
