Beijing’s Shouqi Gets Online Car-Hailing License

(Beijing) — A locally prominent firm has received Beijing’s first online car-hailing license, as regulators use new rules to ramp up the threshold for companies to operate in the dynamic but unruly sector.

Shouqi Limousine and Chauffeur, a unit of one of Beijing’s oldest taxi operators, was awarded a four-year operating license on Wednesday by Beijing traffic authorities, the company said. The award makes Shouqi only the second company in China that can legally offer online car-booking services in Beijing and throughout the nation, though its drivers must be further validated individually by local police.

CEO Wei Dong said his company will work hard to make sure its drivers are properly certified, adding that all online driver certificates among an initial batch awarded by the interior city of Chongqing were obtained by Shouqi drivers.

Unlike many online chauffeur services such as Didi Chuxing, which recruit private car owners who mostly drive part-time and compete with ordinary taxis, Shouqi’s car-hailing business focuses on higher-end, more-expensive chauffeur services.

Shouqi’s receipt of an online booking license comes two weeks after another company, Warburg Pincus-backed UCar, became China’s first legal online car services provider when it received a license from southeastern China’s Fujian province.

Different local interpretations of the national law that legalized the sector last year have raised the bar for companies and private drivers to varying degrees. Some cities have embraced the business, while others, like Beijing and Shanghai, have seriously hampered new entrants by banning out-of-town drivers and cars.

Didi Chuxing, which has 80% of the internet car-hailing market in China after its merger with Uber’s China unit last year, has yet to receive a license. The company says its process is more complicated because of its huge size.

According to figures disclosed at a closed-door conference and revealed to Caixin, only 10% of Didi’s 200,000 active drivers in Beijing meet the city’s strict new requirements that would allow them to keep working for the company.

Contact reporter April Ma (fangjingma@caixin.com)