(Yicai Global) Oct. 25 -- Daimler Mobility Services and Geely Group under Zhejiang Geely Holding Group will form a joint venture to supply premium ride-hailing services in China, with each to hold 50 percent, they announced yesterday.
The two signed a framework agreement at Daimler's Stuttgart, Germany headquarters, with senior company officers from both sides looking on. The news was released on both the Geely and Daimler official websites.
The JV, to be based in Hangzhou in southeastern China's Zhejiang province, will offer online taxi services in some Chinese cities using Mercedes-Benz and other luxury vehicle -brands.
The marque's S-Class, E-Class and V-Class luxury utility vehicles and Mercedes-Maybach sedans will deploy in the initial stage and Geely Group's superior pure electric vehicles may also join the fleet in future. Details have not been forthcoming thus far as to the JV, which awaits Chinese regulatory approval, according to Zhejiang Geely Holding Group's official website.
"Daimler is ideally positioned to continue its transformation by expanding into a comprehensive mobility services company as we pave the way to autonomous driving. With Geely Group, we have found an excellent partner to expand our mobility services in China," said Klaus Entenmann, chief executive of Stuttgart-based Daimler Financial Services, adding, "The joint venture will play a significant role as we continue to enlarge our portfolio and global presence and solidify our strong position in the mobility market."
"We are delighted to have defined terms for a premium ride-hailing joint venture with Daimler Mobility Services," said An Conghui, president of Geely Holding. "The development of such services, in which both companies already have a presence, forms part of our transformation from a vehicle manufacturer into a global automotive technology group," he continued, per the Geely Group announcement.
Daimler Mobility Services' official page on professional networking site LinkedIn explains this shift as: "Daimler Mobility Services GmbH is uniquely positioned to drive the evolution of mobility! With brands such as car2go, mytaxi and moovel but also with autonomous driving as well as our own eWallet 'Mercedes pay," we are pioneering the realm of innovative mobility services. Our digital concepts optimize existing transportation infrastructure and develop future flexible and ecofriendly mobility solutions."
Geely Holding launched CaoCao, the Chinese domestic ride-hailing service that now has more than 17 million registered users, with one million regular active users on the app providing more than 29,000 pure electric vehicles in 28 cities across the country and with over 360,000 completed trips throughout the land on a daily basis.
With car2go and Car2Share, Daimler currently provides free-floating as well as station-based car-sharing services to over 470,000 customers in China. The proposed JV is another step in the implementation of the Daimler's strategy, with its four pillars being 'connected, autonomous, shared & service and electric drive.'
They say, the JV will complement CaoCao and Car2go, since the JV is positioned at premium service.
The new JV will face cutthroat competition from entrenched players like Didi Chuxing, Meituan Dianping and upstarts like Hello TransTech, operator of the Hello ride-share bikes. Didi also launched its luxury car-hailing service in May.
Geely Holding has acquired 9.69 percent stake in Daimler, to become the latter's largest shareholder. Forming the ride-hailing JV marks the start of their cooperation.
Daimler and Geely Group will be equally represented on the JV's board and jointly develop the software infrastructure the business needs.
Editor: Ben Armour