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Uber
and its larger China rival, Didi Kuaidi, have spent heavily to
subsidize rides to gain market share, betting on China's
Internet-linked transport market becoming the world's biggest.
Travis Kalanick, CEO of Uber Technologies, told reporters in the
Chinese capital on Friday he recognizes that spending on
subsidies is "how you win" in China and that the company aims to
beat Didi Kuaidi by spending subsidies more efficiently.
"I worry about it every day," he said, regarding the heavy
spending on subsidies. Uber currently operates in 22 cities in
China but Kalanick said it does not turn a profit in any city.
Didi Kuaidi, backed by Chinese Internet heavyweights Alibaba
Group Holding Ltd and Tencent Holdings Ltd, has the country's
biggest market share of car-hailing apps.
Uber China's recently-closed Series B fundraising brought in
"well over $1 billion", Kalanick said. A spokeswoman for Uber
said the series had raised over $1.2 billion but declined to
give an exact figure.
"I thought we did remarkably well especially given some of the
macro trends that were going on," Kalanick said.
In September, Kalanick had said the unit had already raised $1.2
billion. The CEO did not comment on Friday on precisely how much
had been raised in the four months since then. Before the latest
fundraising, Uber's China unit was valued at $7 billion.
Kalanick warned that the market for fundraising would calm down
at some point and the current high spending on subsidies cannot
continue forever.
Uber's profits in other markets can be invested in Uber China
and that income will eventually become a more important source
of investment than fundraising, he said.
(Reporting by Jake Spring; Writing by John Ruwitch; Editing by
Muralikumar Anantharaman)
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