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Latepost has learned from several independent sources that Didi has started the project, led by Yang Jun, vice president of Didi and general manager of Xiaoju.He is also the chief product officer of D1, a customised ride-hailing service launched jointly by Didi and BYD, and the team has already started poaching people from car factories.However, Latepost has not yet learned the specific form and path of Didi's car construction.

Zhu Jiang, former vice president of user development at Nio, is likely to join Didi, a person familiar with the matter said.Zhu Jiang has many years of experience in automobile industry, and has worked in BMW Brilliance, Lexus, NIO, Ford China and other companies.

In addition to the new developments, Latepost has learned from inside Didi that its self-driving subsidiary plans to try new paths beyond its own research and start a new self-driving truck business.

Didi declined to comment.

Didi has several car-building projects in the works

In November 2019, Didi and BYD set up a joint venture, Beautiful Chuxing (Hangzhou) Automotive Technology Co., with BYD holding 65% and Didi 35%, and BYD as the controlling shareholder.The two subsequently launched a customized ride-hailing service, D1, in November 2020. At that time, Didi was also directly involved in the cooperation with Xiaoju.Didi's car service business started in 2016 and became Xiaoju's car service independently in 2019. At present, it includes Xiaoju youche (car rental platform), car maintenance, second-hand car, charging and refueling.Didi wants to focus on renting from the front end to the back end, with services such as maintenance, insurance and energy.

In June 2020, Didi Autopilot, a subsidiary of Didi, announced a partnership with BAIC, in which the two sides will jointly develop high-level self-driving customized models for RoboTaxi (self-driving taxi) operations.

And this time Didi started to build a car, is likely to be along the D1, the further exploration of customized online car hailing.

Analysts in the industry say Didi's new car plan will be different from the car-company-dominated approach it took when it launched the D1.This time Didi will be more capital-intensive and more engaged.This echoes Didi's message when it launched D1, which stressed that it was the "first" custom ride-hailing service.

According to the plan previously mentioned by Cheng Wei, founder and CEO of Didi at the D1 launch, Didi's customized ride-hailing service will continue to iterate, and by 2025, the customized version of D3 will be popular on Didi's platform, with more than 1 million units. By 2030, the D series aims to eliminate the cockpit and achieve full driverless driving.

On the other hand, although Didi has made more efforts to build cars, according to industry analysts, it is not possible for Didi to set up a wholly-owned subsidiary to build cars like Xiaomi, because its capital may not be able to keep up with it, and its model may be lighter than Xiaomi's.

One investor believes that it is a more economical choice for Didi not to build cars by itself. At present, the production capacity of car companies is too large, and Didi, as a big customer, can completely eat a part of the upstream profits.But building your own can tell a better capital story and keep drivers further on the platform.

Didi has partnered with third-party car rental companies in many places, allowing drivers without cars to hire cars to join Didi's platform to pick up customers.But aggregated car-hailing platforms such as AutoNavi, Meituan and Hello are also courting local car rental companies to compete with Didi.By providing its own operating vehicles, Didi could reduce its reliance on third-party rental companies and reduce the cost of securing drivers.

Whether it was D1 last year or the new plan now, there is a clear logic behind Didi's entry into the custom ride-hailing service.Currently, the cost of the online car hailing market based on fuel models is too high, which directly leads to the limited scale of the online car hailing market and low profit.

Customizing ride-hailing is one way for Didi to reduce costs and improve operational efficiency.In 2018, Didi and Ideal had previously planned to cooperate in this area and set up a related subsidiary, JudianChuxing, in which Didi held a 51% stake and Ideal 49%.

However, Latepost previously reported that Didi's cooperation with Ideal has been terminated and that Judian plans to become an independent OEM-travel company with new strategic shareholders.

Since then, Didi has established joint ventures with BAIC, BYD and Volkswagen.But Didi's tie-up with Volkswagen and BAIC has yet to materially develop.

Li Xiang, founder of Ideal Auto, said at the time that the future evolution of the mobility market will be in line with the logistics industry standard, which means the lower the cost the better and the more efficient the better.The partnership between Ideal and Didi is aimed at further reducing costs on the premise of safety.According to Li Xiang's calculation, the cost of the new car may be 10~15% more expensive than that of the ordinary fuel-powered car, but the battery life will double, and the amortized cost per kilometer will drop 0.5~0.6 yuan, or nearly 20%, compared with that of the fuel-powered car.

What's more, customized online car hailing can also improve user experience and produce cars that are more suitable for driverless driving, making preparations for the landing of driverless driving in the future.

As a result, custom ride-hailing could also become a connection point between Didi's ride-hailing platform service and its Robotaxi business, which its self-driving subsidiary is building up.

Didi's self-driving business may also be changing

In addition, a person close to drops autopilot told the late LatePost drops autopilot company is currently in the research of automatic driving route, is also considering to try the second route, the route may be combined with vehicle road new "Robotaxi ping's", namely the side access Robotaxi enterprises with operational vehicles, access to the passengers.

But given that Didi itself is doing Robotaxi, if it takes this route, the short-term drag will be persuading other Robotaxi companies to work with Didi.Currently, Chinese companies such as Baidu, Xiaoma Zhixing and Wenyuan Zhixing all have their own taxi-hailing apps, while AutoX can use AutoNavi to take taxis. The biggest challenge for the autonomous driving industry is technology and product maturity rather than competing for passengers.

Meanwhile, Didi Autopilot has also started experimenting with a self-driving truck project, which is being led by Didi Autopilot CTO Wei Junqing, confirmed by Late Latepost.

On Friday (April 2), two days after the official announcement, the Huaxia Alumni Association, attended by many entrepreneurs and investors, was held at the Xiaomi campus. A photo of Lei Jun with Wang Chuanfu, Li Bin, Li Xiang and He Xiaopeng was widely circulated.

Cheng Wei, the CEO of Didi, was also at the table with Li Xiang and Li Bin, but in the group photo, Li Xiang were on stage and Cheng Wei and Yang Jun were in the audience.

Mr Cheng has previously said Didi does not build cars and is not seeking to become the biggest car operator in the future.Didi's core competence is to serve its users and car owners well, and to keep investing and making breakthroughs in big data and technology.

Mr Cheng may have to eat his words. He and Didi will also be in the car building business.But from the business logic, it is good news.

Didi has more on its plate than just building cars.Didi plans to go public this year. In order to achieve better market valuation, Didi has carried out more diversified business expansion, including "Orange Heart Preferred", which is now a key business community group purchase.Community group-buying is also a capital-heavy track, and brings together the giants with the strongest financial strength at present -- Meituan, Pinduoduo, Ali and Jingdong all regard it as an important direction.

Bloomberg had previously reported that Didi had plans to inject about $3 billion into its preferred unit.Didi is also working with financial advisers to raise about $1bn from outside investors.

More deeply involved in and led the launch of customized online car hailing, into the self-driving truck, into the community group buying market, Didi will be listed this year, the new moves continue.Didi, which has always been considered by the market to be relatively cautious in making decisions, showed a sharper ambition on the eve of its listing.

Edit/Viola

Risk note: the author's or guest's opinions above all have their own specific positions. Investment decisions should be made on the basis of independent thinking.Futu will do its best but cannot guarantee the accuracy and reliability of the above information and will not be liable for any loss or damage caused by any inaccuracy or omission.

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