Alibaba-backed Chinese car trading platform SouChe acquires rival Cheyipai

SouChe, a Chinese automotive platform backed by several investors including Ant Financial and Alibaba, announced that it has acquired used car marketplace Cheyipai.

In an announcement, SouChe said, Cheyipai will be operated independently under its original brand, team, and organizational structure.

“It is rather strategic collaboration rather than merely acquisition but the capital cooperation will enhance the relationship between the two companies,” said SouChe CEO Kevin Yao.

Cheyipai, launched in 2016, focuses on used-car inspection and online auction. Through the platform, car dealers make bids online based on inspection reports, allowing auctions to be completed in 15 minutes.

Currently, Cheyipai’s trading network has covered more than 600 cities across the country. The platform has more than 65,000 car dealers and it has inspected and traded more than 3 million used cars.

SouChe, which successfully raised more than $600 million of funding from a number of investors in 2017, said it has digitalized the operation for over 30,000 used car dealers, 60,000 Tier 2 new car dealers, and 5,000 4S (sale, spare parts, service, and survey) stores.

Through cooperation with automobile manufacturers, Ant Financial, and offline car dealers, SouChe launched its car leasing product, TanGeChe, which requires only 10-per cent down payments for new cars.

The announcement also revealed that SouChe is also working on the acquisition of iyunche.cn, a vehicle logistics platform, to provide better delivery services to used car transactions.

The deal is expected to build up the core competitiveness of used car trading, namely quick deal, better price, and fast delivery, SouChe said.

Yao said, the trading volume of used cars reached tens of millions in 2017, while less than 10 per cent of the figure was contributed by the top three e-commerce platforms of used cars.

“As long as a new growth point is created, all the players will have the opportunity to get into the arena for next level of competition,” Yao said.

Before the acquisition, the main players in online used car market were Guazi, xin.com, and renrenche. SouChe’s acquisition of Cheyipai will change the competition from a game of three players to a game of four players, industry insiders predicted.

In an interview with CNBC, Yuan, SouChe’s CFO, said China’s auto retail and finance market is at more than Rmb10 trillion ($1.57 trillion).

“I think the growth rate for the next five years will be close to 20 percent,” Yuan was quoted as saying.

Also Read:

China’s used car financing startup Meiliche secures $92m led by New Hope Group

Didi Chuxing invests $200m in Chinese used car platform Renrenche

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.