DiDi and SoftBank Launches Joint Venture in Japan to Offer Taxi-Hailing Service

Didi Chuxing (DiDi) announced a joint venture with SoftBank on July 19 to offer on-demand taxi-hailing services and smart transportation solutions for customers in Japan, the world’s third largest economy.

SEE ALSO: Booking Invests $500 Million into DiDi, Forging a Strategic Partnership

This is another overseas move by DiDi following its entrance into Mexico and Australia earlier this year. DiDi received investments from Softbank in two rounds of fundraising last year and the two entered into a partnership in February.

SoftBank and its Vision Fund of nearly $100 billion have also invested in ride-sharing companies Uber Technologies Inc., India’s Ola and Southeast Asia’s Grab, according to Reuters.

“DiDi believes AI-based innovation may contribute to new growth of taxi industry and the public transportation sectors,” said Jean Liu, president of Didi Chuxing, “We look forward to developing extensive collaboration with all industry players to assist in smart city initiatives in Japan and Asia.”

With advanced mobile internet infrastructure and a global reputation for high-quality taxi service, Japanese market holds great potential for online taxi-hailing. There is earnest demand for more convenient urban and regional transportation services, especially in light of its growing population of senior citizens.

DiDi Mobility Japan Corp. (DiDi Japan) will cooperate with Softbank Group to help taxi companies improve their services and user satisfaction, and build more broad-based demand for taxi services, according to Stephen Zhu, vice president of Didi Chuxing and CEO of DiDi Japan.

Cities in Japan are bracing for a new phase of economic expansion and tourism growth. According to Japan National Tourism Organization, in-bound travelers grew by 28 percent annually, and the number of Chinese visitors from the mainland and other regions increased by 34 percent year on year between 2012 and 2017. The upcoming 2020 Summer Olympics in Tokyo brings new opportunities for the Japanese taxi industry as well.

However, Japan has strict rules against ride-sharing for fear of safety concerns brought by unprofessional or unlicensed drivers. For future operations in Japan, DiDi needs to put more emphasis on enhancing safety regulations, lest tragedies like the murder or assaults of female passengers take place again.