General Motors Corp's investment in a Chinese car-sharing application developer demonstrates the auto maker's keen interest in the world's largest auto and car-sharing market, observers said.
GM on Wednesday declined to reveal the size of its investment in Yi Wei Xing (Beijing) Technology Co Ltd, which developed Feezu, a car-rental and car-sharing app that merges hardware and software and enables users to rent vehicles by the minute, hour or day.
"It is GM's first investment in a startup in China related to urban mobility," a company spokeswoman told Reuters. "This cooperation is very important to our company to explore the ride-sharing market in China."
"Only time will tell if this move is significant, but it shows that GM is paying close attention to the Chinese market," said Eric Dennis of the Center for Automotive Research in Ann Arbor, Michigan, in an email.
As ride-hailing services like Uber in the US and Didi Chuxing in China have grown, GM and other major automakers have been quick to partner with them and participate in this fast growing segment of what is referred to as the "sharing economy". Earlier this year GM invested $500 million in the ride-hailing company Lyft and also launched Maven, which provides short-term car rentals.
"This is an important step for GM to explore and engage with new mobility markets in China, in particular with a company which already has a presence in that market," Jeremy Carlson, principal automotive analyst for IHS Markit, said in an email.
"GM has been aggressively building up the Maven brand, and the investment in Yi Wei Xing may be a signal that the automaker is likely looking to bring its Maven brand to China, a very important market both for new mobility solutions and for the company overall," he added.