June 15, 2018 / 4:13 AM / 10 months ago

Chinese ride-sharing giant Didi picks Australia for first Western foray

SYDNEY, June 15 (Reuters) - Didi Chuxing Technology Co Ltd, the Chinese ride-sharing company which bought the mainland operations of Uber Technologies Inc, said it will begin offering its service this month in Australia, its first foray in a Western country.

The scheduled June 25 launch in Australia’s second biggest city Melbourne sets Didi up for a showdown with the U.S. rival it bought out in China in exchange for a stake. Didi started expanding outside Asia in Mexico earlier this year, and has said globalisation is a core strategy.

Didi’s announcement on Friday about the launch shows business deals between China and Australia are being struck as normal even as relations between the two governments have hit a speedbump after the Federal Government proposed anti-foreign interference laws directed at Beijing.

Australian exporters have blamed anti-Beijing rhetoric for delays clearing product through Chinese Customs.

But just a day earlier, Australia’s Sirtex Medical picked a $1.4 billion Chinese takeover offer that trumped U.S. company Varian Medical Systems.

“Australia has diversified mobility needs, a business-friendly environment and an inclusive culture,” Didi, which is backed by bluechip investors including SoftBank Group Corp and Apple Inc, said in a statement. “Didi wishes to contribute to the growth of Australia as a long-term investor and business partner by offering affordable, reliable and convenient mobility options and income-generating opportunities,” it added.

Melbourne, a city of 4.5 million people with cheaper real estate than larger Sydney, is a popular Australian entry point for companies in the so-called “sharing economy”. Uber has routinely launched new offerings in the city, while several Chinese and Singapore-owned dockless bicycle rental companies have picked Melbourne to start in Australia.

“We welcome competition because it keeps us focused on delivering the very best product and customer experience for riders, driver partners and Uber Eats customers and partners,” an Uber spokeswoman said in an email.

Didi did not give any investment details or a timeline for expanding its Australian operation outside Melbourne and was not immediately available for comment.

Its statement said it would “shape product offerings and user experience in Australia based on the feedback from drivers and passengers in Melbourne and Geelong”, a satellite city 75 kilometres (46 miles) away.

The Chinese company started recruiting drivers in Melbourne in early June “to warm responses”, it added.

Didi cemented its spot as China’s biggest ride-hailing company when it bought Uber’s operations in the country in 2016. (Reporting by Byron Kaye; Editing by Muralikumar Anantharaman)

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