Photo/Zhangjian

Nov. 23 (NBD) – German auto manufacturer BMW has won a ride-hailing license in Chengdu, southwest China's Sichuan, becoming the first foreign automaker that is approved of ride-hailing service offering in China, Reuters reported.

The service is to be provided by 200 BMW 5 Series vehicles including fuel and plug-in hybrid models with 200 drivers for each car.

The new move follows the German firm's business expansion in China's mobility field. On December 1 last year, BMW's car-sharing service ReachNow made the debut in Chengdu, offering station-based premium electric car-sharing. The first-ever individual mobility solutions to Chinese customers by BMW are operated by 100 units of pure electric BMW i3.

According to consulting firm Bain & Company, China's ride-hailing market is worth 23 billion U.S. dollars, more than any other markets combined, and Didi Chuxing grabbed 90 percent of all bookings.

The market size of ride-hailing sector will reach 267.8 billion yuan (38.6 billion U.S. dollars) in 2018 and will further go up to 503.6 billion yuan (72.7 billion U.S. dollars) by 2022, another report from research institution askci.com predicted.

Besides, so far the market penetration is still less than 20 percent in China.

Seeing the huge potential of the domestic ride-hailing market, plenty of players have entered the niche sector scrambling for market shares.

There are over 100 ride-hailing platforms in operation in Chinese cities now, the Ministry of Transport of China revealed.

Apart from the dominator Didi Chuxing, Yidao Yongche, Shenzhou Zhuanche, Shouqi and Caocao Zhuanche have established their presence in the market.

Meanwhile, as the domestic auto market faces declining sales this year, traditional car makers are seeking for new distribution channels as well as source of profit growth.

Data from China Association of Automobile Manufacturers shows China's auto sales volume dropped by 11.7 percent to 2.38 million units in October and the passenger car sales have been falling for five consecutive months.

It is noted that Zhejiang-based Geely Group and German auto manufacturer Daimler set up a 50-50 ride-hailing joint venture in October, planning to launch ride-hailing service in some cities of China with Daimler's premium cars including Mercedes-Benz S-Class, E-Class and V-Class cars, and Geely's all-electric vehicles.

SAIC Motor announced on November 12 the launching of a new mobility strategic brand under which medium- and high-end car service is arranged.

On November 16, the mobility unit of Volkswagen forged partnership with a Guangzhou-based company to develop ride-hailing and car rental business.

Email: zhanglingxiao@nbd.com.cn