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China's cab-calling apps to cancel passenger subsidies

Editor: zhenglimin 丨Xinhua

05-16-2014 21:50 BJT

HANGZHOU, May 16 (Xinhua) -- China's two most popular cab-calling apps have announced that they will cancel payment subsidies for passengers from Saturday.

The announcement on their Twitter-like Weibo accounts signals a truce in the price war between smartphone apps Didi and KuaiDi, which belong to Chinese Internet giants Tencent and Alibaba respectively. The promotion has contributed greatly to a boom in the mobile payment market.

According to a letter KuaiDi released on Friday to its customers, the subsidy program will end at 12 a.m. on Saturday after running for more than five months. The company will provide various discount periodically in the future.

The letter said KuaiDi has collected much user feedback and found that what they really need is not a subsidy but a way to hail cabs in a more convenient and effective way, which was the original goal of developing the app.

Meanwhile, Didi also announced that it will suspend cash subsidy for customers who hail cabs via the app. But it said it will offer more diversified rewards in ways other than cash.

Both apps said they will keep their subsidies for taxi drivers.

According to market researcher Enfodesk, China's taxi-hailing apps had nearly 100 million users by the end of the first quarter this year.

KuaiDi tops the list with 51.6 percent of market share, while the number of cities covered by KuaiDi and Didi has reached about 200, the statistics indicate.

Alibaba and Tencent have invested heavily in cab payment subsidies to promote their online payment service since last December.

With these incentives, passengers and taxi drivers could both get payments if the passengers choose to hail cabs and pay fares via the companies' online payment services.

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