As of March 31, 2024MegamillionsdrawingtodayA total of 345 ride-hailing platform companies across the country obtained the operation license of the ride-hailing platform, an increase of 38 over the same period last year, and a total of 679 car-hailing driver licenses were issued.Megamillionsdrawingtoday.10,000 and 2.847 million vehicle transport certificates, an increase of 29.9% and 26.5% respectively over the same period last year.
◎ Wang Kaifeng
In March, Ruqi Travel, which is rooted in Guangdong-Hong Kong-Macau Greater Bay Area, submitted its prospectus to the Hong Kong Stock Exchange; in April, Didi Chuxing and Cao Cao Chuxing also launched a sprint on the Hong Kong stock IPO. Since the beginning of this year, with a number of ride-hailing platforms to Hong Kong IPO, online ride-hailing market pattern is brewing new changes.
According to Cao Cao's travel prospectus, China's travel market will be about 7.5 trillion yuan in 2023, of which the market for shared travel services is 282.1 billion yuan, with a penetration rate of 3.8%. By 2028, the market for shared travel services is expected to grow to 751.3 billion yuan, with a compound annual growth rate of 20.6% since 2024, and the penetration rate of shared travel services is expected to increase to 7.3%.
The rapid growth of the market size will undoubtedly attract more capital attention. A reporter from the Shanghai Securities News found from the prospectuses of the three travel platforms that the choice of impact listing at this time, on the one hand, benefited from the accelerated recovery of the ride-hailing market, on the other hand, it also hoped to seek new breakthroughs in the business model under the background of intensified homogenization competition in the industry.
The pain point of "burning money" with a sharp increase in revenue is difficult to eliminate.
In 2023, the ride-hailing market accelerated to pick up. According to the statistics of the online ride-hailing regulatory information interaction system, as of March 31, 2024, a total of 345 ride-hailing platform companies across the country had obtained the operation license of the online ride-hailing platform, an increase of 38 over the same period last year. A total of 6.791 million online ride-hailing driver certificates and 2.847 million vehicle transport licenses were issued, an increase of 29.9% and 26.5% respectively over the same period last year.
As the absolute leader of the industry, DiDi also made his first annual profit in 2023. Revenue in 2023 was 192.4 billion yuan, an increase of 36.6% over the same period last year, and the annual net profit was 540 million yuan. According to relevant statistics, in 2023, Didi accounted for 75.5% of the ride-hailing market in terms of GTV (total transaction volume), while the top five participants accounted for 90.6% of the market share.
Specifically, from the three IPO enterprises in Hong Kong: Cao Cao's revenue in 2023 was 10.67 billion yuan, an increase of 39.8% over the same period last year, and the gross profit margin changed from negative to positive; Didi Travel realized revenue of 815 million yuan in 2023, an increase of 43.2% over the same period last year; and Ruqi Travel realized revenue of 2.161 billion yuan in 2023, an increase of 57.9% over the same period last year. In terms of revenue data, all three ride-hailing platforms have achieved substantial growth in 2023.
Although the revenue increased, the loss continued. Cao Cao's prospectus shows that from 2021 to 2023, the company's net profit was-3.007 billion yuan,-2.007 billion yuan and-1.981 billion yuan respectively, with a total loss of 6.995 billion yuan and an adjusted net loss of 5.576 billion yuan. Ruqi Travel, which also hit the Hong Kong stock IPO, according to the prospectus, the cumulative loss during the three-year reporting period reached 2 billion yuan.
In fact, in order to compete for orders from drivers and users, the platform will often "burn money" to formulate subsidy policies, making it difficult for profits to become a persistent pain point for the ride-hailing industry, which is also an important reason for travel companies to seek access to the capital market.
According to the prospectus, Cao Cao's income and subsidy expenditure for travel drivers was 8.146 billion yuan in 2023, accounting for 76.3% of revenue. Ruqi Travel also said that the loss was mainly due to high revenue costs caused by expanding geographical coverage and acquiring new users at the initial stage of business development.
The new mode of homogenized competition needs to be broken through urgently.
In addition to solving the pain point of "burning money", under the background of intensified homogenization competition in the industry and gradually saturated transport capacity, travel companies also hope to use capital to find new breakthroughs in the business model.
In the prospectus, Cao Cao Chuxing analyzes three "deep-rooted" challenges in the shared travel industry: first, the high cost of using cars and poor user experience; second, the heavy workload of drivers but low income; and third, it is difficult for the travel platform to effectively optimize operating costs, making it difficult to make a profit.
According to reports, in 2022, Cao Cao began to deploy custom cars to provide chauffeured car services. as of December 31, 2023, the company has a fleet of about 31000 vehicles in 24 cities, making it the largest fleet of customized cars in the same industry in China. In order to enhance the user experience, improve comfort, and improve the quality of service, Cao Cao said in the prospectus that the amount raised will be used to upgrade and launch customized cars in the next three years. Used to improve the company's car service solutions and improve the company's service quality and so on.
Data show that, as one of the earliest Robotaxi travel platforms in China, such as Qi Travel is accelerating the commercial landing of Robotaxi and autopilot technology in the past two years. In June 2023, Ruqi Travel cooperated with Horse Zhixing and Shenzhen Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone Administration to carry out pilot autopilot commercial operation in Shenzhen Qianhai Cooperation Zone.
The cooperation with Horse Zhihang provides cutting-edge technology for Ruqi's exploration in the early stages of the commercialization of self-driving travel services, Ruqi said in its prospectus. The funds raised from this listing are expected to be used for autopilot and Robotaxi operation service development activities; travel service product upgrading and operational efficiency improvement; expanding user base and increasing market share; investment, acquisition and replenishment of working capital.
Compared with the other two platforms, the tick-tock business, which is based on the ride service, is relatively simple. The company said in its prospectus that in this sprint for listing on the Hong Kong Stock Exchange, the proceeds are planned to be used to expand the company's user base, strengthen marketing and promotional activities, enhance technical capabilities and upgrade security mechanisms, and enhance liquidity; working capital and other general corporate uses.
As one of the important ways for people to travel, ride-hailing has become an indispensable part of many people's lives. As an important part of ensuring operation and stable employment, how to manage user information and ensure data security, control operating costs and balance with its own financial situation under the development of new energy vehicles and self-driving technology will also become a common challenge for the ride-hailing platform IPO.