Business / Corporate

SoftBank to test Japan ride-hailing service with China’s DiDi Chuxing in autumn

by Kazuaki Nagata

Staff Writer

SoftBank Corp. announced on Thursday that it will launch trial services for its taxi-hailing platform this fall by teaming up with Chinese mobility tech giant DiDi Chuxing.

SoftBank and DiDi set up a joint venture last month called DiDi Mobility Japan to run the platform, which the firms say will improve the efficiency and quality of cab services and eventually help the industry grow.

Japan already has several similar ride-hailing services, but the entry of DiDi — whose 550 million clients make it one of the largest in the world along with SoftBank — will raise the bar on the competition.

“We believe this joint venture will add tremendous value to the taxi community in Japan, leveraging the technology abilities of DiDi as well as SoftBank’s strong presence and strong customer base in Japan,” said Stephen Zhu, head of DiDi Mobility Japan.

The two firms said Japan’s taxi industry faces a number of issues, including aging drivers and a cabbie shortage, as well as growing demand caused by a tourism boom.

This is apparently where technology can help. DiDi is focused on using artificial intelligence to improve efficiency and safety based on transport data collected by the service.

DiDi said it will provide a management console to taxi companies that helps them more easily monitor dispatches and provide driver evaluations made by customers to improve services.

Customers can install a hailing app on their smartphones that not only allows them to order cabs, but also allows them to pay via credit card. China’s DiDi app will also be usable in Japan and provide customers the option of using Alipay or WeChat Pay for payment. This will help cover demand from Chinese tourists, who dominated Japan’s tourism ranks last year, the firms said.

The trial is scheduled to start in Osaka this fall and expand to Kyoto, Fukuoka, Okinawa and Tokyo. It will only match customers with legally registered cab firms because individuals are banned from offering rides to strangers and charging fares.

DiDi Mobility Japan said it will follow the rules, but SoftBank Group CEO Masayoshi Son expressed frustration the same day at a separate event, saying ride-sharing is an innovative service changing the world.

“Ride-sharing is illegal in Japan. I cannot believe there is still such a foolish country. What’s worse, it’s our own country, Japan,” he said.

SoftBank Group has been investing in ride-hailing companies around the world. It invested $5.1 billion (about ¥560 billion) in DiDi through one of its funds last year and acquired a 15 percent stake in ride-hailing giant Uber in January.