Foxconn Technology Group has joined the growing portfolio of international companies that have invested in China’s dominant and homegrown ride-hail startup, Didi Chuxing.
Didi is worth $34 billion after an investment by Foxconn
Didi says the two companies are exploring opportunities for cooperation but as yet have no concrete plans.
The company announced it has invested $119.9 million in Didi for a 0.355 percent stake in the company, Recode has confirmed. That brings the company’s valuation to $33.8 billion, according to numbers included in Foxconn’s filing with the Taiwan exchange.
Foxconn’s investment, which was first reported by The Wall Street Journal, coincides with Didi Chuxing’s exceedingly aggressive moves to secure its future.
Didi’s position as the dominant transportation platform in China (and eventually other parts of the world) was initially bolstered by Apple’s $1 billion investment in the company in May. Apple’s investment was part of a larger $7.3 billion round.
In Apple, Didi found a powerful international ally with the resources to bankroll a ground war against competitors. In Didi, Apple may have found a way to mend its frayed relationship with the Chinese government.
That brings us to Foxconn and Apple. Foxconn is Apple’s largest constructor of iPhones, and though there’s no immediate indication that Foxconn’s investment in Didi relates at all to Apple’s, a collaboration among the three would be in line with the companies’ transportation ambitions.
Apple is reportedly working on its own electric car, codenamed Project Titan, an effort that involves hundreds of Apple employees.
So far, Apple has kept its car ambitions under wraps but it stands to reason that if the company chooses not to work with an automaker it could create a car the way it manufactures iPhones: Conceive the parts and assemble it at Foxconn, but this time leverage Didi’s platform to bring those “iCars” to consumers.
Didi says it’s exploring the possibility of working with Foxconn (not Apple) but there are no official plans as of yet.
“With the support of Foxconn and other value investors home and abroad, Didi will continue to push the frontier of innovation for the mobile transportation market and create ever stronger driver and rider communities,” a Didi spokesperson said in a statement. “Both Didi and Foxconn are focused on innovation and execution. We are exploring possibilities, but there are no concrete plans for cooperation yet.”
If nothing else, the investment may help Didi focus on improving its service and innovating now that it is freed up from focusing on simply competing for riders and drivers. In early August, Didi Chuxing neutralized one of its biggest threats and ended a heated and expensive battle with its primary competitor by acquiring Uber China and investing $1 billion in Uber’s global efforts.
That move happened in spite of a partnership and related investment in a trio of Uber’s international competitors: Lyft, Grab and Ola. As Recode previously reported, Didi told players in the partnership that the company had no plans to reach an agreement with Uber just weeks before the company acquired Uber China.
While Didi’s international future is a bit murkier since its Uber investment, the company still has to focus its efforts on truly saturating and acquiring all of China’s potential consumer market.
This article originally appeared on Recode.net.
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