Uber is growing at a rapid pace in China, with 1 million rides made every day and four out of Uber’s 10 largest cities now in China. The San Francisco-based ride sharing app, founded in 2009, now expects China to replace the U.S. as its largest market.
According to a leaked email obtained by the Financial Times, Uber China is growing at staggering speed. Hangzhou and Chengdu have grown in just nine months to the same size New York was four years after launch, with Chengdu nearly 500 times larger than New York was at the same point after launch.
Urban density has a lot to do with it. There are over 80 cities in China with more than 5 million people. Travis Kalanick, the chief executive who sent the email to Uber investors, says the company plans to launch in 50 of these cities by the end of the year, expanding from the current 11 it operates in. Kalanick also expects China to overtake the U.S. market in size by the end of the year.
“Since our launch in February 2014, we have found a public that is embracing Uber far beyond our most bullish expectations,” said Kalanick.
The email is part of a plan by Uber to invest RMB 7 billion (over $1 billion) to execute this expansion, with Uber hoping to secure a new round of funding this month on top of its current $1.5 billion in raised funds. A fundraising process for Uber China will launch June 22.
Uber has succeeded well beyond expectations, with a New York Times article this week putting the figure of daily China rides at somewhere over 100,000 rides per day, and Uber worldwide hitting 1 million rides per day globally in December 2014. However, rival Didi Kuaidi could pose a serious threat to future growth.
“One competitor has cloned our core product line and is attempting to transition from its legacy taxi business to a similar P2P model,” Kalanick said. “Despite this competitor’s supposed advantage of a massive taxi user base, we are quickly becoming the share leader in P2P.”
Sources speaking to the Financial Times say that Uber’s next round of funding could bring the company’s valuation up to $50 billion.