If you think that partnerships in Asia don’t mean anything, then you have not read up on your Asian history. Both China and Japan are rife with historical deals and betrayals, where the end justifies the means. The latest major change in Uber’s Asian presence is actually led by two of its partners; one is a partner rival while the other is an investor with its hands in a lot of pies.
Didi and SoftBank have decided to team up with Japanese automaker Toyota to back a $67 billion deal investing in Japanese taxi giant JapanTaxi. JapanTaxi is owned by Ichiro Kawanabe, and he is the man behind Japan's largest taxi service Nihon Kotsue as well as the chairperson of the Japanese Taxi Federation.
The new venture is a rideshare app that will be used for all Taxi's around Japan, effectively wiping out ridesharing competition and retaining the power in the hands of the taxi drivers. This deal, in fact, is very balanced on that takes into account the need to retain the livelihood of taxi drivers as well as move them into the modern era with a rideshare app. The Japanese market is a hybrid of both worlds that enables the Japanese regulators to retain control of an economy that has gone totally haywire everywhere else in the world.
Did I forget to mention that Toyota is also an Uber investor, well it is, and that means that Uber is being ousted from Japan by three of its partners? As the saying goes, if you can't trust your friends who can help you trust. In the rideshare sector, there is no trust, it's a gold rush and will continue to be a gold rush for the next ten years while the world adapts and changes to the new market. It will continue to be a gold rush when AVs are introduced. Basically, we are living in an era that matches the invention of the steam engine.
JapanTaxi will provide a few interesting features with its app, including a fare calculator for when you take the app offline, and a ride booking option for children. What is actually interesting is the fact that JapanTaxi has all the benefits of starting out late and none of the drawbacks. Its a start from a period where technology has been used, developed and honed to perfection.
Uber only covers around one percent of Tokyo's transportation market, while JapanTaxi covers a quarter of the entire country, which is 60,000 cars and four million app downloads. The Japanese taxi industry is valued around $15 billion per annum, and with this new deal, it looks like SoftBank is on for another role of success. This also goes hand in hand with their decision to pressure Uber from leaving Asia to the Asian's and concentrating on North America and Europe.
DOUG it is. DOUG got the dough and every ridesharing startup is wagging their tail for it.