SAN FRANCISCO • Apple Inc said it has invested US$1 billion (S$1.3 billion) in Chinese ride-hailing service Didi Chuxing, a move that Apple chief executive Tim Cook said would help the firm better understand the critical Chinese market.
The tech giant's rare investment gives it a stake in two burgeoning waves of technology - the sharing economy and car technology - as the iPhone business that propelled it to record profitability shows some signs of maturing.
Apple is trying to reinvigorate sales in China, where it has come under greater pressure from regulators, and Mr Cook is travelling to the country this month.
The move aligns Apple with Uber Technologies Inc's chief rival in China, as carmakers and technology firms forge new alliances and make cross investments.
General Motors, for example, recently bought autonomous driving technology company Cruise Automation and has also taken a stake in the United States ride-sharing company Lyft.
The iPhone maker will help Didi build up a ride-sharing platform that handles more than 11 million rides a day and serves about 300 million users across China, Didi said in a statement yesterday.
It joins other investors, including Alibaba Group and Tencent Holdings, the country's two largest Internet companies.
Uber is spending millions to try and catch up with Didi in China, yet its business in the country is just a fraction of its local rival's.
Both companies are in an expensive battle for market share, raising capital needed to recruit drivers and subsidise customer fares.
HSBC Securities Asia analyst Chi Tsang said: "Didi's a good partner to have, it's a good operator, and could provide additional collaboration with Alibaba and Tencent."
Didi, formally known as Xiaoju Kuaizhi, was created last year when separate apps backed by Tencent and Alibaba merged.
It now operates in 400 Chinese cities with 14 million registered drivers, offering services from taxis and private cars to social ride-sharing and test-driving.
Uber, the world's most valuable start-up, has set a target of operating in 100 Chinese cities this year. The company has said it is able to support its China push because it is making US$1 billion annual profit from its 30 largest global markets.
It did not respond to e-mailed requests for comment.
Apple's investment comes as the iPhone maker is under pressure to find other markets to expand in as its main smartphone business slows.
On Thursday, it ceded the mantle of world's most valuable company by market valuation to Google, after shares sank below US$90 for the first time in nearly two years during trade.
BLOOMBERG, REUTERS
