Dead end for taxi-app subsidies

Taxi apps call time on cash incentives for passengers

The daily number of orders made using taxi hailing app Didi Dache dropped by 40 percent, after the company running the app stopped subsidizing passengers last week, the Beijing News reported on Wednesday.

Cheng Wei, CEO of Beijing Xiaoju Technology Co that operates Didi Dache, said only 3 million orders are made on average daily on the smartphone app now, compared with 5.3 million daily at its peak before the company announced on Saturday that it would stop subsidizing taxi riders.

Before Saturday, taxi riders who used Didi Dache to hail a taxi could get 3 yuan ($0.48) back per ride. Earlier this year, passengers were able to get 12 yuan back from Didi Dache, which is embedded in Tencent Holdings' WeChat app.

"Around 85 percent of Didi Dache users paid on WeChat when we offered the 12 yuan rebate. Now, 75 percent pay on WeChat," Cheng said, noting that the payment habit has been successfully formed.