I.T Box looks to revolutionize car-hailing market

I.T Box, a Beijing-based startup, is planning to carve a niche in China's giant but fiercely competitive car-hailing market, with Didi Chuxing as the dominant player since it took over Uber's operations in the country in 2016.

There were more than 330 car-hailing service providers in China by the end of October 2023, according to the Ministry of Transport. In 2022, over 19 million car-hailing trips were made on a daily basis.

I.T Box is not planning to become just another ordinary provider and join the rat race. It is thinking outside the box to solve the pain points in the business.

"Didi did a great job by making car-hailing part of our daily life. But increasingly, we find none of those in the business are happy. This is where we are going to make a difference," said founder and chairman Zhang Shuguang.

He explained that passengers are sometimes not very happy with the experience when they have cumbersome luggage or travel for a long distance in a car with little legroom.

Drivers often complain that they are earning less money as the bumper subsidies have gone, and rising insurance costs are hurting fleet management companies' profit, among other things.

I.T Box's solutions include customizing vehicles for the segment, with the first model to hit the market in late 2024. So far Didi and other service providers drive people around in ordinary vehicles.

Zhang said the first-row passenger seat in its first model is removed, the space of which could be used to store luggage, offer the passengers more legroom or allow the driver to rest in a sleeping bag.

It won't compare to a bed at home but at least it allows them to lie down. Usually, they simply recline the driver's seat and take a nap when they are too tired.

The startup is also installing automatic vendors and displays inside the vehicles, and it is planning to share the revenue via these devices with the drivers. "They will be happy when they can earn additional money," said Zhang.

He said the company can win the favor of car-hailing fleet owners because it can slash its insurance policy.

"We produce the vehicles ourselves. So we can offer better active safety features, such as fatigue alert, and we have the data about the vehicles and the drivers' behaviors as car manufacturers," said Zhang.

The startup is to produce its models with carmaker Haima in Central China's Henan province, with the first one to roll off the assembly line in late 2024. It expects sales to reach 50,000 units in 2025 and double to 100,000 units in 2026.

Zhang said its business strategy is "city by city". He added some cities have shown interest, including Nanyang in Henan province and Pingtan in Fujian province.

He was quick to add that it is not out to challenge Didi or any other major players like AutoNavi. "Instead, we are going to work with them," said Zhang.

Didi Chuxing has its own fleet but it offers options on its app for users to select other service providers as well. AutoNavi does not have its own fleet at all so it directs orders to service providers.

A poll by Beijing University of Technology shows that 55 percent of car-hailing service users will choose more providers while around 80 percent of drivers take orders from at least two platforms at the same time.