'Cabby village' highlights popularity of taxi apps in China

A taxi driver is reflected in a side mirror as he uses the Didi Chuxing car-hailing application in Beijing, China.
A taxi driver is reflected in a side mirror as he uses the Didi Chuxing car-hailing application in Beijing, China.PHOTO: REUTERS

SHENZHEN (China Daily/Asia News Network) - Nowhere else in China has the impact of taxi-hailing apps been more felt than in Dawang, a village in Shenzhen.

Fewer and fewer red and silver taxis are seen in the streets of Dawang these days as drivers switch to working for private cab-hailing companies such as Didi Chuxing and Uber.

With these new cab-hailing services muscling into the traditional taxi industry, drivers say they are forced to switch sides.

"Driving a taxi isn't profitable anymore. We (the drivers) had to find another way to survive," said Mr Li Jianbing, who used to make 6,000 to 7,000 yuan (S$1,250 to S$1,458) a month, not quite enough to feed his family.

Since joining Didi Chuxing last September, however, his earnings have almost doubled.

"Driving a car on the company's platform, I can earn about 12,000 yuan a month," he said.

Dawang, located at the foot of Wutong Mountain, is home to more than 1,000 drivers and their families, which is why it is also known as "taxi-driver village".

About 1,000 people from Dawang now work for Didi Chuxing, according to an article in FiftyKM, one of the company's accounts on WeChat, a popular instant-messaging platform. It is not clear how many of them are former taxi drivers.

Full-time drivers of Didi Chuxing and Uber use private vehicles, so every defection means one taxi fewer on the roads.

Mr Huang Youren, director of the Shenzhen Xihu Taxi Operating Management Centre, said the city's cab drivers are losing significant revenue while taxi companies are struggling to cope with the exodus, according to a report in the Shenzhen Special Zone Daily in July.

In the past two years, the popularity of the new services has soared in China.

Didi Chuxing operates in hundreds of cities, with daily bookings reaching 10 million. The company said 1.43 billion car rides were booked via its platform nationwide last year.

However, as companies are forced to expand rapidly to cater to growing demand for their services, the question of passenger safety has emerged.

According to a report published by the Shenzhen Transportation Commission, 1,425 drivers working for online platforms are found to have a history of drug abuse, and 1,662 have serious criminal records. The findings raise serious questions about the companies' screening procedures.

The city government has pledged to step up efforts to regulate the emerging industry to ensure fair competition and passenger safety.

"The relevant government departments will supervise online car-hailing platforms, step up efforts to crack down on illegal operations, and accelerate the formulation of policies to regulate the industry to ensure a free market for transportation and satisfy the needs of local residents," said a commission official, who asked not to be named.

When contacted by China Daily, Didi Chuxing declined to discuss the findings outlined in the report.

The good times are over for taxi-rental companies, which used to charge as much as 250,000 yuan for a five-year lease on a taxi. These days, the "licence fee" is 90,000 yuan. The money is returned in full when the contract ends.

"Ten years ago, we never imagined that WeChat would be created and become so prevalent. Similarly, several years ago we could never have expected that the taxi business would be hit so hard by online cab-hailing services," said taxi-driver Li Jianbing who joined Didi Chuxing last September.

"The good days for taxi drivers are gone."