Ctrip licensed to offer ride-hailing service in China

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Online travel site Ctrip has been licensed to offer ride-hailing services in China, a move that could intensify the rivalry in the rapidly growing Chinese market dominated by Didi Chuxing.

The company didn’t reveal details on when and where it would officially introduce the service, according to a statement released on Tuesday.

It is the latest entrant following Chinese map provider Amap and Chinese tech company Meituan Dianping in the country’s ride-hailing market.

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The market has about 225 million riders but only 100,000 drivers last year, according to data from Chinese Ministry of Transport. The short supply shows huge potential in the market.

Beijing-based Didi became the dominant player in the country after Uber exited the market in 2016. Uber lost a price war with Didi, with billions of yuan spent on users to give them free rides and thus win their loyalty.

“Now the focus of competition in ride-hailing has shifted from price to service. Users are more willing to pay for good service. Using subsidies may lower the quality of service and eventual lose customers,” said Li Qiao, the chief executive of Ctrip’s ride-hailing service unit.

Shanghai-based Ctrip is China’s largest online travel platform that provides services such as hotel reservations, flight ticketing and package tours.