(Yicai Global) Aug. 20 -- China's online ride-hailing market is expected to recover in the next few years after stalling in the wake of passenger safety concerns and stricter regulation, according to a new report by US consulting firm Bain & Co.

The market may grow at less than 5 percent this year, down from a 25-percent clip last year, said Bain's APAC Mobility Report 2019 published today. But it sees the pace picking up to between 10 percent and 15 percent in 2021, when the market will be worth about USD60 billion, up from USD40 billion last year.

After two passengers were murdered in separate incidents last year while using the services of Didi Chuxing, China's market leader, the number of monthly active users fell about 5 percent. The murders also led to the suspension of Didi's Hitch carpooling service and stricter regulations from local governments.

The Beijing-based company's Hitch service is expected to resume operations following new safety measures from Didi and as consumer confidence returns.

Bain's report suggests unprofitable companies in the sector, such as Didi, offer differentiated services, like high-end offerings that target business travelers, to boost the number of rides and commissions. That would help them to turn a profit. And with markets in China's high-tier cities nearing saturation, domestic ride-hailing platforms should focus on lower-tier cities and explore new revenue streams through mergers and acquisitions in other parts of the auto industry.

The report also noted that the global leaders, including Didi, San Francisco-based Uber Technologies and Lyft, have not yet been able to earn large profits due to competition between platforms as well as with traditional taxi companies.