SID: 500614282
Industries have been transformed since the rise of the sharing economy, which has challenged traditional business models (Li et al., 2018). The emergence of various sharing economy platforms has provided businesses with new resources and opportunities, as well as consumers with a wide selection of services and goods and a high-quality and guaranteed experience. Ride-hailing platforms such as Uber, DiDi and DiDi Chuxing have created a new type of employment by allowing car owners to use their private cars to register as ride-hailing drivers. This not only provides flexible and autonomous employment opportunities for individuals, but also more efficient, affordable and varied options for passengers. The pervasive adoption of neoliberal principles within sharing economy companies has led to the emergence of a new term – the Gig Economy (Zwick, 2017). In addition, sharing accommodation platforms such as Airbnb and online e-commerce trading platforms such as Alibaba are all successful examples of the sharing economy model. However, at the same time, there are many negative considerations associated with the sharing economy, one of which is the impact and disruption of the sharing economy on traditional industries, such as the suppression of the taxi industry by ride-hailing platforms, the effect of sharing accommodation platforms on the hotel industry, and the impact of e-commerce platforms on the real economy (Laurell & Sandström, 2018). As a near-monopoly platform in China’s car hailing market, DiDi Chuxing provides passengers with a variety of vehicle types to choose from when booking a vehicle, including but not limited to private cars and taxis, which well proves that the sharing economy can be a cooperative relationship with traditional industries. Such co-operation builds a stable bridge between the sharing economy and traditional industries.
“Apple invierte 1000M en el Uber chino para potenciar el Apple Car” by iphonedigital is licensed under CC BY-SA 2.0.
The partnership between DiDi Chuxing and the taxi industry has brought more exposure and opportunities to the taxi industry. For a traditional industry like taxi, the cooperation with the sharing economy can be considered a transformation, and the benefits of this transformation for taxi services are greater than the disadvantages (Osman & Mohd Yusoff, 2020). First of all, when a user uses DiDi Chuxing to take a car, the user can choose from a variety of types of vehicles according to their needs, such as private cars with a better price advantage, taxis with a better safety guarantee, luxury cars with an impeccable service, and spacious large cars. All these different types of vehicles will appear together on the selection page for the user to choose from, along with the estimated price and estimated time of arrival of the vehicle. These information will be clearly displayed together to the user. This provides more customer flow to the taxi industry, and even if users didn’t download the app because of taxis, the taxi option will always be visible at first sight, which will increase the probability of it being selected. Secondly, there are a number of reasons why the ride hailing industry has emerged and attracted people so much, one of which is the wider and looser locational options as well as the time savings (Rossmannek & Chen, 2023). Passengers often encounter situations where they want to take a taxi on the road but can’t get one, and DiDi Chuxing can be a great solution to this problem, as taxis are booked within the online platform and the vehicle will drive to a designated location to pick up the passenger. Passengers can also use the platform to choose to depart immediately or book a trip for a specific time. Passengers can also see the expected arrival time of the vehicle through the platform when the journey is about to start, which saves passengers the time of waiting for the vehicle. Third, the taxi industry, as a traditional industry, has higher requirements and assessment of driver qualifications than individual drivers, and passengers usually have a higher level of trust in taxi drivers (Ma et al., 2019). For example, when traveling alone at night, choosing to take a taxi may make passengers feel more at ease, but some passengers may give up choosing a taxi because of the convenience of the ride-hailing platform or they may not be able to find a taxi in their location, DiDi Chuxing will become a good choice for these passengers at this time. Moreover, in addition to the credibility of the taxi service itself, the platform has also increased the safety supervision of passengers.
As an intermediary platform connecting drivers and passengers, it has been of great help to DiDi drivers, passengers and especially the taxi industry (Meng, 2017). The emergence of the new profession of ride hailing drivers has allowed more individuals to get jobs. For individual drivers, while they receive their income from labour, it has also increased the usage of private vehicles and provided them with more flexible working hours and opportunities; For passengers, they can choose the type of vehicle that suits their needs based on the estimated price and the estimated time, and whether or not to carpool to save on their budgets, as well as booking in advance to avoid waiting; For taxi drivers, firstly, partnering with the sharing economy platforms provides them with a reliable flow of customers, not only avoiding the blow to the taxi industry caused by the rise of emerging industries, but also guaranteeing them a consistent and stable income. Secondly, taxis often have idle time while waiting for passengers, and apart from queuing up for passengers at airports, the traditional taxi model requires taxi drivers to look for passengers on the street, which means they need to look for passengers while they are driving. The online model is very different, as taxi drivers can park their vehicles and wait for online orders to be dispatched (He, 2016). This saves on fuel consumption and increases the earning potential of drivers. This efficient utilization of time and resources has significant benefits for taxi drivers.
“China – Taxis” by eviltomthai is licensed under CC BY 2.0.
Although the rise of sharing economy has always been a topic of discussion regarding whether it will disrupt traditional industries (Blockx et al., 2018), DiDi Chuxing, as a highly popular car hailing platform, has increased the exposure and passenger resources for the taxi industry, provided taxi drivers with higher earning potentials and opportunities, and effectively prevented the suppression of the traditional taxi industry by the emerging industry, which is a good example showing that the sharing economy and the traditional industries can be a co-operative relationship. The sharing economy may be suppressing traditional industries (Mohammad, 2023), but if traditional industries try to change their inherent models, such as co-operating with emerging models, they may not only avoid being suppressed, but also find new resources and opportunities. This could be a win-win situation for both traditional and emerging industries.
References
Blockx, J., Levitt, M., Schöning, F., Coulter, A., Stefano, G. D., & (Editor), P. C. (2018, June 15). Sharing and traditional economy: A matter of substitutability… between cats and dogs?. Kluwer Competition Law Blog. https://competitionlawblog.kluwercompetitionlaw.com/2017/03/24/sharing-traditional-economy-matter-substitutability-cats-dogs/
He, H. (2016, September 1). Didi partners with China’s taxi companies to upgrade services. South China Morning Post. https://www.scmp.com/business/china-business/article/2012291/didi-partners-chinas-taxi-companies-upgrade-services
Laurell, C., & Sandström, C. (2018). Comparing coverage of disruptive change in social and traditional media: Evidence from the sharing economy. Technological Forecasting and Social Change, 129, 339–344. https://doi.org/10.1016/j.techfore.2017.09.038
Li, Z., Hong, Y., & Zhang, Z. (2018). An empirical analysis of the impacts of the sharing economy platforms on the U.S. labor market. Proceedings of the 51st Hawaii International Conference on System Sciences. https://doi.org/10.24251/hicss.2018.084
Ma, L., Zhang, X., Ding, X., & Wang, G. (2019). Risk perception and intention to discontinue use of ride-hailing services in China: Taking the example of Didi Chuxing. Transportation Research Part F: Traffic Psychology and Behaviour, 66, 459–470. https://doi.org/10.1016/j.trf.2019.09.021
Meng, J. (2017, March 31). Didi Chuxing to use this one advantage in race for self-driving cars. South China Morning Post. https://www.scmp.com/business/companies/article/2083875/didi-chuxing-plans-use-one-advantage-crush-its-rivals-race-self
Mohammad, H. (2023, January 25). The impact of the sharing economy on traditional businesses. Medium. https://medium.com/@mhmdhm/the-impact-of-the-sharing-economy-on-traditional-businesses-b154879f2e06
Osman, S., & Mohd Yusoff, R. (2020). Impact of technology on taxi industry: Determinants on Ridesharing in Kuala Lumpur. Albukhary Social Business Journal, 1(1), 119–144. https://doi.org/10.55862/asbjv1i1a010
Rossmannek, O., & Chen, M. (2023). Why people use The sharing economy: A meta-analysis. Journal of Cleaner Production, 387, 135824. https://doi.org/10.1016/j.jclepro.2022.135824
Zwick, A. (2017). Welcome to the gig economy: Neoliberal industrial relations and the case of Uber. GeoJournal, 83(4), 679–691. https://doi.org/10.1007/s10708-017-9793-8
Didi Chuxing is a good example of demonstrating the cooperative relationship between the sharing economy and traditional industries. © 2023 by Yiting Liu is licensed underCC BY-NC 4.0
