China's Regulators Pitch Camp at Didi HQ After Passenger Deaths Incense Nation
Zhao Chenting
DATE:  Sep 06 2018
/ SOURCE:  Yicai
China's Regulators Pitch Camp at Didi HQ After Passenger Deaths Incense Nation China's Regulators Pitch Camp at Didi HQ After Passenger Deaths Incense Nation

(Yicai Global) Sept. 6 -- Chinese transport, justice and security officials have set up camp at Didi Chuxing's Beijing headquarters after two users of the car-sharing platform wound up dead in the space of three months.

Representatives from 10 government departments, including the Public Security Bureau and the ministries of transport and justice, will be stationed at the firm's offices for two weeks from yesterday, the transport ministry said in a statement the same day.

The Chinese public has been outraged since a 20-year-old was raped and murdered by her Didi Hitch driver in Zhejiang province last month, the second such killing this year. Hitch is a car-pooling service offered by Didi that pairs drivers and passengers heading in the same direction, and has much less stringent requirements than its official ride- and taxi-hailing services.

Liu Xiaoming, the vice minister of transport and head of the inspection group, told Didi to fully cooperate with the inspection and be responsible for the people, industry and history.

"Have awe and respect in your heart, and do not cross the line before building a sustainable company."

No Safety in Numbers

The investigation will extend beyond Didi. Regulators plan to inspect all web-based ride-hailing services throughout the country by the time they are through, cleansing the sector of hidden dangers that threaten passenger safety.

Other targets include Shouqi Limousine & Chauffeur, Ucar, Cao Cao, Yidao Yongche, and Meituan-Dianping. But not only the companies are at risk. The regulators plan for the investigation to be a sweeping probe that includes diving into local administrative departments and seeing how effectively they performed their duties.

Didi founder Cheng Wei has already pledged to the visiting officials that the firm will stump up CNY140 million (USD20.5 million) to improve its customer service after the incident. The company had been criticized for failing to respond after a complaint was made against the driver in the most recent murder case just a few days before the killing. He allegedly repeatedly asked the female passenger to sit in the front seat, drove her to a remote location and followed her after she left his vehicle.

Cheng has used the app's vast size -- it has more than 30 million daily active users -- as an excuse for its lack of vigilance. But the company has vowed to suspend late night services (between 11 p.m. and 5 a.m.) for a week in China starting Sept. 8, and to introduce a one-click 'call police' button in its app.

Didi has not performed effectively in terms of security management, Cheng said, claiming to have overemphasized passenger safety in terms of road traffic collisions or violent confrontations between drivers and passengers, but neglected to pay attention to malicious crimes that it considered less likely to occur.

Driving Without a License

Chinese government regulations specify that ride-hailing platforms must receive approval from city transit agencies, but Didi reportedly only has such permits in 60 cities -- far fewer than the number of locales it operates in, data from the Ministry of Transport shows. Many cities also require ride-hailing providers to hire only local drivers using locally registered vehicles, but Didi has apparently flaunted that rule with little regard for the consequences.

Shanghai refused to give Didi a license because it employed drivers and used cars that did not qualify under those rules, Ma Fei, deputy director of Shanghai's transport bureau, said in April. But that has not stopped the firm, which is readily accessible throughout the city.

Didi has shrugged off the penalties levied against it after being fined more than CNY100,000 (USD14,580) eight times since 2015, he added, saying that the company has happily paid up each time, but has done nothing to fix the problems.

The company has also refused to disclose driver and vehicle data with local regulators across the country, Wang Fumin, deputy director of Guangdong province's transport department, said late last month. He expects the firm to undergo a complete overhaul and supply all necessary data by the end of the year as the government cracks down on shady ride-hailing practices.

It has submitted data for 44 cities but the information it has supplied has been incomplete, late and of poor quality, according to the national transport ministry.

Editor: James Boynton

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Keywords:   Didi Chuxing,Hitch,Ride Sharing,Ride Hailing,TRANSPORT,DEATH,Regulators