Didi Travel, which is stuck in the quagmire, wants to go public and head-to-head with Meituan and Gaode

html On May 7th, according to The Information, a well-known American technology media, Didi Chuxing is formulating a plan to go public and is expected to go public in the United States this summer. It is worth noting that Didi is also preparing to spin off the community group buying business “Orange Heart Preferred” within a year or two after its main IPO, and then list it separately. After

entered 2021, the news of Didi's listing has been circulating. Interestingly, in the past few months, the rumored listing venue of Didi was the Hong Kong Stock Exchange, but after entering April, these rumors pointed more to the US stock market.

htmlIn early April, Reuters reported that Didi plans to secretly submit an application for listing in the United States within the month, and plans to go public in July at the earliest. Earlier, a person familiar with the matter also told the media that the audit team of PricewaterhouseCoopers had settled in Didi in January, and Didi’s IPO is expected to be carried out within this year, and it plans to raise about $10 billion at a valuation of $100 billion.

Regarding the rumored listing of Didi from , Hong Kong and to the United States, some industry insiders believe that Didi chose to go public in the United States because it ran into a wall on the Hong Kong Stock Exchange. But in any case, Didi's listing is a long-awaited thing for many parties.

html lost 50 billion in 17 years, how did Didi survive the money-burning war?

In 2012, Cheng Wei , deputy general manager of Alipay's B2C division, resigned from Alibaba and founded Xiaoju Technology, which was later called Didi Chuxing. In 2016, Didi Chuxing became the largest taxi software platform in China. Today, Didi has not only dominated the online car-hailing battlefield - it has become a veritable overlord of in the domestic travel field.

According to media reports, since 2017, Didi's market share in the field of travel has exceeded 90%. Its travel business ranges from two to four, covering online car-hailing, ride-hailing , special cars, takeaway delivery, Logistics, freight , etc.

In order to seize the market, Didi has relied heavily on the "burning money" strategy since its establishment. The constant burning of money brings huge losses. According to media reports, Didi lost more than 50 billion yuan by the end of 2019, of which 11 billion yuan was lost in 2018.

has been established for 7 years and has suffered losses for 7 years. Why does this company continue to operate?

Didi's secret to its survival is the "external blood transfusion" with a huge amount of money. According to the company's data, Didi has received strategic investment from more than 40 domestic and foreign investment institutions, including China Merchants Bank, Alibaba, Tencent Investment, Apple, Softbank, Temasek, etc., in the past nine years, with a cumulative amount of more than 20 billion yuan. US dollars, equivalent to more than 120 billion yuan. It can be said that if it hadn't been for external blood transfusions, Didi's money-burning game would not have been so smooth.

By 2020, Didi's core business seems to have ushered in a turning point. In an interview with the media, Didi President Liu Qing suddenly announced that Didi's online car-hailing business has made a small profit. This news made many industry insiders and investors a little excited at the time. It seems that the industry has started to make money, and the real spring has come.

The glossy appearance of

can't cover up the deeper problems, and Didi still faces serious challenges.

ushered in the "encirclement and suppression" of Meituan, Gaode , Hello , DiDi, which is in the quagmire, still has to fight hard. Profitable, and over time, all aspects of Didi's mobility business have been challenged.

In 2018, due to two consecutive security incidents, Didi , under pressure from all parties, announced that it would be offline for rectification indefinitely, which also made Didi bid farewell to its original leadership in the ridesharing business. Before going offline, the ride-hailing business is still one of the few profitable businesses under Didi. According to media reports, Didi’s ride-hailing turnover in 2017 was close to 20 billion yuan, with a net profit of nearly 900 million yuan.

Taking advantage of the time when Didi rides off the assembly line, new and old players in the travel field, such as Hello Travel, Dida Travel , Cao Cao Travel , have poured into the ride-hailing market. Among them, Dida Chuxing, which specializes in the ride-hailing business, took advantage of the trend, came up with a subsidy plan of 1 billion yuan, and quickly accumulated a large number of users. In 2019, it took the top spot in the ride-hailing market with a share of 66.5%. At present, both Hello Travel and Dida Travel have submitted their prospectuses, and they will both be strong opponents to compete with Didi for the “first share of travel”.

is not just a hitchhiker, but DiDi's other businesses in the travel field are also constantly being challenged.

In 2017, AutoNavi and Meituan took advantage of the platform's traffic advantages and began to integrate other taxi platforms, which greatly lowered the entry threshold for online car-hailing, allowing those local taxi companies with huge capacity to complete the transformation more quickly. It is foreseeable that Didi will face more competition from powerful rivals in the future.

Not only that, but also new and old travel brands such as T3 Travel jointly funded by FAW, Dongfeng and Changan, Great Wall Motor 's Oulo Travel, and SAIC Group's Xiangdao Travel. Meituan and AutoNavi cooperated to receive orders through these two platforms, which greatly reduced the operating costs of the platform.

While the four-wheel business was in a quagmire, Didi's two-wheel business Qingju Bicycle was not doing well. From 2018 to the present, Qingju Bicycle, Meituan Bicycle , and Hello Bicycle are still fighting in the field of shared bicycles. Among them, Qingju Bicycle has just completed a financing of 600 million US dollars, and Hello Travel is going to go public in the United States. Meituan The bicycle is backed by the Meituan Group, and Didi will have to go through a hard battle to stand out from it.

Car manufacturing, freight, community group buying, can the expanded business map allow Didi to "stop the bleeding"?

Although Liu Qing, president of Didi Chuxing, once said that there is still "huge room for growth" in the domestic car-hailing market, Didi's imagination in the field of travel is very limited, both in terms of market and other aspects. In order to "stop the bleeding" and reduce losses, Didi chose the strategy of opening source and throttling , and finding new growth points. In terms of open source

, Didi no longer adheres to the asset-light model, and chose to win the car rental cake by itself. Didi set up a car rental delivery center, and in 2019, it launched a customized version of the car-hailing D1 with BYD . Since then Didi Driver has been able to purchase vehicles directly from the platform.

Not only that, Didi is also eyeing the sinking market and launched Hua Xiaozhu taxi, which is still the usual method of burning money, but the excessive expansion speed has also caused Hua Xiaozhu to be questioned by many parties.At a regular press conference of the Ministry of Transport this year, spokesman Sun Wenjian said that Hua Xiaozhu had the lowest double compliance rate, and it was the only platform with a compliance rate lower than 20%.

In addition to continuing to make efforts in the field of travel, Didi has also made many cross-domain attempts.

Didi began to prepare for autonomous driving technology in 2016. In 2018, it announced the establishment of a "torrent alliance" with 31 car companies including BAIC, , Geely , etc. By the beginning of April this year, Didi officially announced that it had joined the car-making team. In addition, Didi launched Didi Freight in May 2020, aiming at the intra-city freight track, and launched the community group buying platform Orange Heart Choice a month later.

In order to save money, Cheng Wei announced in 2019 that Didi was "preparing for the winter" and laid off 15% of the workforce at one time, with more than 2,000 employees. It is worth noting that the subsidies for Didi drivers and passengers are also decreasing.

For now, Didi's biggest problem is whether its core business can truly continue to be profitable. However, the increment brought by reducing operating costs is always limited, and it is still unknown whether opening up and reducing expenditure can bring longer-term and more lasting profits to Didi.

Although Didi’s “overwintering” strategy has brought certain results, it is more embarrassing that whether it is car building, intra-city freight, community group buying, and Hua Xiaozhu platform, continuous financial support is required. Under the circumstances, Didi's listing of seeking financial support from the secondary market seems more like a last resort.

For Didi that needs a lot of financial support, listing in the US may be a good choice. Compared with the Hong Kong stock market, the US stock market has a larger capacity and more abundant funds, and the listing rules are clearer and the rhythm is easier to control. Bring more support to Didi.Didi's road to listing may be full of variables, but for many investors who have been waiting for many years, whether Didi, which has continued to lose money, can successfully break through is what they care about.