Chinese ride-hailing giant Didi Chuxing announced on Friday that its autonomous driving subsidiary has raked in $500 million in what is the firm’s first external funding round since DiDi created the subsidiary in 2016.
Led by SoftBank’s Vision Fund, the transaction will enable DiDi to continue financing advanced research and development of autonomous driving technology and testing. The funding will also help the company accelerate the deployment of self-driving services in specific areas in China and abroad, per a statement.
DiDi said the deal is the largest fundraising round in China’s autonomous driving sector so far.
Like Google, which spun off its self-driving unit into a standalone business, Waymo, in December 2016, Beijing-based DiDi also upgraded the unit into an independent company in August 2019 to specialise in level 4 autonomous driving technology.
The subsidiary holds open-road testing licenses in Chinese cities of Beijing, Shanghai and Suzhou, as well as in California in the United States, including one of the first licenses in Shanghai to pilot manned autonomous mobility services. It aims to launch autonomous fleet operations in select locations in China after heightened investments in self-driving technology, vehicle-to-everything (V2X) systems and related AI capabilities.
While building the test fleets, Didi will leverage the accumulated transportation data from its ride-hailing platform to run simulation tests. Didi said that this could largely supplement existing field test data volume, improve the R&D efficiency and facilitate algorithm iteration.
Launched in June 2012, Didi now serves a total of over 550 million users across Asia, Latin America and Australia, providing a host of services like taxi, bike-sharing, e-bike sharing, enterprise solutions, designated driving, automobile solutions, food delivery, and payment, among others. It boasts more than 10 billion passenger trips per year.
Statistics indicate that Didi’s autonomous driving unit still needs to catch up with the development of its domestic counterparts.
According to a report issued by the California Department of Motor Vehicles (DMV) in February 2020, Didi’s self-driving venture ranked eighth in 2019 under a disengagement rate of 0.682 per 1,000 self-driven miles, following some best performers like Baidu (0.055), AutoX (0.094), and Pony.ai (0.154).
The report, which was compiled based on the data that the companies are legally required to share with the authority, shows that Baidu’s Apollo project surpassed Google’s Waymo (0.076) for the first time to become the best-performing company last year.
The term “disengagement” refers to the number of miles driven by autonomous vehicles and how often human drivers were forced to take control of the vehicles actively testing their systems on public roads in California.
As Chinese startups staged as some of the leading players in the self-driving field, McKinsey & Company estimated that China’s autonomous vehicles could account for as much as 66 per cent of the passenger-kilometres travelled in 2040, generating market revenue of $1.1 trillion from mobility services and $900 billion from sales of autonomous vehicles by the year.
Apart from robotaxi services, Didi’s self-driving venture also partners with its one-stop auto solutions platform Xiaoju Automobile Solutions and DiDi Finance, which offers auto financing and wealth management products on the Didi app, to explore next-generation integrated mobility solutions, such as smart charging networks, fleet maintenance service, and insurance programs for autonomous fleets.
Tony Qiu, chief operating officer of Didi’s international operation, told Reuters that the coronavirus pandemic could impact Didi’s overseas business by “double-digit.” He expected the overseas operations to turn a corner after some recovery from a mid-March low.