At 7:10 a.m. last Friday, as passengers got off the bus and closed the door with a "snap" sound, Master Wang, the driver of Cao Cao Travel Network at the entrance of Beijing Maternity Hospital, completed the third business of the day. The payment price displayed on the passenger side was 37.11 yuan, while the income price displayed on the driver side of Master Wang was less than 28 yuan.
"This [online car-booking] doesn’t make money, it has to run for 14 hours a day, which is considered a pit. There is not much left after throwing away the gas money and car money (running water) in one day. Unless the oil price drops to 5 or 6 yuan [per liter] before, I will not do it after running this year’s contract." Master Wang complained to the Daily Economic News reporter. "The Hyundai Yuedong I drive is rented, and I have to pay 200 yuan a day for car rental."
In addition, Master Wang sometimes uses another mobile phone to receive orders from Feidi Taxi, but he will turn off Feidi Taxi during morning and evening peak hours. He said that the "one price" model launched by Feidi Taxi during morning and evening peak hours often has a discount of 60 to 10%, and the time spent waiting for red lights and traffic jams is not included in the order time, so it is completely unprofitable to take such orders by yourself.
In the online car-hailing industry, some drivers call it a sunset industry, but there are more and more online car-hailing platform companies in the industry, and the competition landscape of the top platforms is also undergoing subtle changes. This not only makes people ask, what business experience does the online car-hailing industry, which is still expanding rapidly, let the platforms see?
"It’s already a sunset industry"
Mr. Du, who is also a driver of Cao Cao’s travel platform, rents a Buick GL8, which is used to run business orders and needs to pay a monthly rental fee of 7,300 yuan.
However, Master Du revealed to reporters: "This [online car-hailing] is already a sunset industry. When it first started, it was impossible to earn a Passat by swiping orders, cheating recharge, and cheating subsidies for three months. When I rented this GL8, I didn’t point to running online car-hailing to make money at all, but by running private work with friends (business reception). In Beijing (including a GL8), the minimum is 500 (yuan) within 8 hours and 100 kilometers…"
"Under normal circumstances, in ******* every year, except for the ****** Festival and before the national **, there are various meetings in succession at other times, and the chartered work has also been continuous. When we are busy, we can connect 24 hours a day (when business charters, in addition to picking up and dropping **f passengers, drivers can rest at other times). This year, ******* is affected by **, and there will be basically no meetings after **. Our WeChat group ** people (contacting each other and introducing chartered business) has only had a message for several days recently." Master Du said.
In fact, online car-hailing platforms will not let drivers "only rent a car without taking orders". They will incentivize drivers to take orders by controlling the commission ratio. "If the monthly flow is 12,000 yuan, the platform will charge 10% [commission]; if it is not 12,000 yuan, the platform will charge 20% [commission]; if it does not run, the platform will often call [to inquire about the reason for not being able to get the car]," said Master Du. Therefore, Master Du sometimes downshifts and uses his business car to pick up comfort orders, which are about 30% cheaper than his normal business orders.
Some people argue that the "sunset industry" and "running online car-hailing" claims mentioned by drivers need to be viewed objectively. The hidden background of these two claims is that in the early stage of the development of the online car-hailing market, the platform expanded the market "regardless of cost". Drivers reaped a large wave of "blue ocean dividends". At that time, most of the drivers who made money had left the online car-hailing market for many years.
Nowadays, the user scale of the online car-hailing market has peaked, and the appearance of the edge of the industry has made it difficult for the platform to "spend money lavishly" as before. Moreover, the travel demand caused by the superimposed epidemic is blocked, and the income of online car-hailing drivers will naturally be "low".
The business experience of the online car-hailing platform "Yimanli"
In sharp contrast to the complaints of drivers, operating the online car-hailing business is undoubtedly a "lucrative" business for the platform, especially the car rental model.
The reporter learned from the Beijing Modern dealer that when ordinary consumers buy the above Yuedong models, the landing price can reach 83,000 yuan (including car price, insurance fee, purchase tax, license fee, and outbound fee). When the online car-hailing platform or its online car-hailing franchisees purchase the model in bulk, the landing price will be lower. Therefore, the online car-hailing platform or its franchisees as the lessor can fully recover the purchase cost by renting a car within 2 years.
On the other hand, behind a number of online car-hailing platforms, there are also car companies participating in the holding, behind Cao Cao Travel, there are Geely Automobile, behind T3 Travel, there are China FAW, Changan Automobile, Dongfeng Automobile, and behind Endao Travel, there is SAIC Group, such as the strategic investment of GAC Group.
The above-mentioned online car-hailing platforms have more advantages in terms of vehicle source guarantee and cost control. In addition, purchasing the backlog of inventory cars from car companies and dealers is also an effective way for the platform to reduce costs. In the car rental model, before the platform and franchisees recover the cost of car purchase, the order commission is their "pure profit"; after recovering the cost of car purchase, the car rental income will also become their "pure profit".
Perhaps seeing the business experience of "one million profits", more and more companies are flocking to the online car-hailing market. Statistics from the national online car-hailing regulatory information exchange platform show that in March this year, 4 new online car-hailing platform companies were added nationwide, 3 in February, 2 in January, and 44 in the whole of last year. As of the end of March, 267 online car-hailing platform companies have obtained the operating license of the online car-hailing platform. In addition, the number of online car-hailing platforms with orders exceeding 300,000 orders in March increased by 2, namely Toutuo E-line and Fengyun Travel.
It is worth mentioning that the current "one super and many strong" pattern of the online car-hailing market is undergoing subtle changes, and the second-tier players, including Cao Cao Travel and T3 Travel, are continuing to make efforts to share more market share.
Cao Cao travel CEO Gong Xin recently revealed at the company’s new business line conference that the cumulative number of users of Cao Cao travel has exceeded 120 million from the 60 million in July last year; the research report issued by Guotai Junan (601211.SH) also shows that the market share of T3 travel has increased rapidly from 3.1% in July last year to 11.6% in January this year, an increase of up to 8.5%.
For the future market size of online car-hailing, Caution Consulting expects that the online car-hailing market in our country will reach a transaction scale of 700 billion yuan in 2025, which will increase by 53.4% compared with the transaction scale of 326 billion yuan in 2022. Obviously, the rapidly developing online car-hailing industry is not a sunset industry, but the game of leading players will make the competition in the industry more intense.
Reporter | Cui Zhiming, Editor | Sun Lei, He Xiaotao, Yi Qijiang, Proofreading | Wang Yuelong
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