China Accuses Uber Of Unsustainable And Unfair Practices

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Speaking to reporters during China's annual parliamentary session earlier today, Chinese transport minister Yang Chuantang has accused certain ride-hailing companies in his country for killing off their competition by subsidizing fares and supplementing driver wages in a way that's not sustainable in the long-term. Chuantang specifically mentioned Didi Kuaidi and Uber Technologies Inc. as companies that are operating in a competitively unfair manner on the market.

China's minister went on to explain that the domestic service Didi Kuaidi and Uber are literally spending billions of US dollars of their investors' money which are being used for funding user discounts and wage bonuses for their drivers. Chuantang announced that he intends to "vigorously press ahead" with a complete taxi industry reform in order to put a stop to this unsustainable fight for the market between Didi Kuaidi, Uber, and all other problematic actors in this scenario. As the Chinese politician stated for the press, "there is a compelling need to deepen the reform of the taxi industry and regulate taxi services to put them on the track of sound and sustainable development". Unfortunately, he didn't elaborate on what that exactly means or when we can expect the reform to start, though the Asian press is guessing we'll probably know more come spring.

China is far from the only country with problems caused by the massively popular ride-hailing apps and services run by the likes of Didi Kuaidi and Uber, but it's one that they come into conflict with most often, and that's been the case for a while now. Even going back as far as 2014 when Uber's Chinese presence still wasn't nearly as strong as it is today, the ride-sharing app company faced illegal behavior accusations on the Far east as it was offering its services via drivers operating in private cars, most of which were not commercially licensed. Naturally, the biggest issue here is money, as the practice of subsidies and wage bonuses for private drivers is first and foremost undercutting state-owned transport businesses. It remains to be seen what will come out of this latest conflict, but China will probably need to act fast if it's really adamant about stopping further "unsustainable behavior" as Uber just got additional $2 billion in funding from its very own domestic investors in January.

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