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Uber China Receives Strategic Investment From Guangzhou Automobile Group


In yet another strategic partnership, Guangzhou Automobile Group co. (GAC) has invested an undisclosed amount in Uber, the multi billionaire, $60 Billion plus valued ride hailing service. This investment will include partnership around auto sales, maintenances of cars, insurance and marketing.

GAC produces both consumer vehicles — under its Trumpchi, Gonow and Changfeng Motor brands — in addition to buses and commercial trucks. The Chinese automobile maker is believed to have submitted a formal statement to Shanghai Stock Exchange for the deal.

Notably, GAC has been putting extra focus on making green cars, an area where Uber has been showing increasingly high interest. This deal will also enable the US-HQed ride-hailing app to step closer to its plan for developing green cars, that will eventually strengthen its business domain within China —  a territory which has historically been a tough market to crack, for US technology companies.

This deal has the potential to boost both companies in their quest to further impact Chinese market in their respective fields. Guangzhou Auto is looking for increased market share in the Chinese car market. By investing in Uber, it is likely to achieve certain level of benefits because the Chinese ride-hailing industry is booming.

As for Uber, it has found great help from the unlikeliest of sources in its quest to dominate the China’s taxi-hailing space. The upstart has been always aggressive about penetrating the Chinese markets.

It is already supported by Baidu Inc. in its China operations. This partnership will further aid Uber to fight against local competitors like DidiKuaidi, who have been putting extra pressure on Uber for a while now.

This is also a part of Uber’s continued strategy of strengthening its foothold in Asian countries, especially when India’s Ola, China’s Didi Kuaidi Joint Co., US-based Lyft and Singapore-based GrabTaxi have now  the global taxi alliance to fight against it.

Senior Writer

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