Didi Chuxing SWOT and PESTLE Analysis

Strength

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Weakness

1. Multiple fatal incidents dented company’s reputation: In 2018, the app cab faced heat due to two fatal accidents where two female passengers were assaulted and killed by their drivers in Didi Chuxing’s ride-sharing Hitch service. The two incidents happened within three months of each other and severely damaged Didi’s reputation as a safe app for women. Celebrities started social media campaigns like #DeleteDidi and the Chinese authorities also called out Didi to take responsibility for the incidents and remove the Hitch feature altogether along with increasing the number of safety features on the remaining app. Statistics taken directly from the Chinese Supreme Court shows that 77.8% of the time when crimes are committed by drivers, the passengers are victimized. Another key way to increase safety is through driver training and education, along with thorough background checks. Didi tried to take several measures to brighten its image, including issuing public apologies and increased safety features but it has been an uphill task.

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Opportunity

1. Accelerating production of self-driving cars: Didi Chuxing’s self-driving technology arm, Didi Autonomous Driving has been testing autonomous cars in China since 2019 and they have made good progress. Didi has now signed an agreement with Swedish car manufacturer, Volvo, who will provide the vehicles for Didi’s self-driving taxis. Volvo is owned by China’s largest private automaker called Geely. Volvo will supply XC90 SUVs to Didi when the launch the commercial autonomous taxi operations. In May 2021, Didi also signed a partnership agreement with GAC Aion New Energy Automobile Group, and they decided to mass produce self-driving new energy vehicles. This will be a joint venture partnership and the two companies will cooperate to develop smart vehicles using Did Chuxing’s Autonomous Driving hardware and software and using GAC Aions’s renewable energy vehicle engineering and manufacturing abilities. Didi also has a strategic partnership with the Huadu District of Guangzhou to invest in R&D for self-driving vehicle technology in the district.

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Threat

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Political

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Economic

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Social

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Technological

1. Developing AI based mobile applications to improve customer experience: Automobile companies were the first implement AI technology in their manufacturing operations. The latest advancements include machine learning to improve the manufacturing process. AI based robots can also make the cars more efficient. Nowadays, cars are coming equipped with sensors that automatically send out alerts about defective parts. Machine learning and AI can also help companies increase their sales by collecting and analyzing consumer data, demographic information and so on, to create personalized recommendations for the customers. AI also has the potential to communicate directly with drivers using a chatbot and sending their feedback to the company directly for resolution of issues. This saves consumer time and reduces the need for call centers. AI can also increase road safety by sensing if other cars are nearby and avoid collisions. Didi Chuxing has a dedicated AI lab to solve difficult AI problems and further innovate in the field of machine learning and artificial intelligence.

Legal

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Environmental

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