Didi Dache and Kuaidi Dache, China's two dominant taxi app firms, have celebrated Valentine's Day by announcing plans to join hands in an historic merger.
Didi Dache, backed by Shenzhen-based Tencent and rival Kuadi, part of Jack Ma's Alibaba empire, resolved to join forces against a common enemy that threatens their continued existence: US app-based transportation network Uber, which has rapidly become the Archenemy of cabbies and taxi app operators nationwide since entering the Chinese market in August 2013.
The two apps together account for virtually all taxi app bookings made in China, and consumers are concerned about how they will benefit from the merger, handing the new company a nation-wide monopoly.
As the two contenders no longer feel the need to compete with each other, consumers fear a decline in "Hongbao" (red envelope) giveaways. In previous years, the two have spent billions of RMB giving away free credit to subscribers and taxi drivers after they link they bank account information to the app, in an attempt to win consumers over to Tencent and Alibaba's competing e-commerce platforms.
Both products will continue to operate separately as independent apps following the merger, but Kuadi CEO Lu Chuanwei and Didi CEO Cheng Wei will both head the new company under a "Co-CEO" system.
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