Didi Crackdown: 6 Possible Reasons
(Jennifer’s note: Someone asked me to give a summary of what the Chinese media are saying regarding why ride-hailing giant Didi was cracked down by the Chinese regime. So the following are 6 possible reasons. )
Didi decided on its IPO in the US AGAINST Beijing’s advice.
The CCP fears about the Data safety amid US-China confrontation. Rumor has it that Didi submitted very detailed info of Chinese maps and user data to the US before its IPO. The data of the maps is not otherwise available to the public, and not the same with the maps everybody is using. Info of some sensitive locations, such as military buildings are also on the maps. Some Chinese netizens are calling Didi “traitor” because of this.
Didi has come out and denied this allegation. I personally don’t believe the US would require Didi to submit this kind of info.
While Xi Jinping vowed to have the West “break their heads and shed blood”, Didi is embracing the US capital. This doesn’t look good for Xi.
The US authorities are now having stricter audit requirements on Chinese companies. As a result, the huge networks behind the listed Chinese companies could be exposed, and those networks involve all the top CCP figures. The CCP doesn’t want to see that.
Power struggle inside the CCP, especially between Jiang Zeming and Xi Jinping. It was said that Liu Qing (or Jean Liu) , the president of Didi, is the daughter of Liu Chuanzhi, founder of Lenovo. Lenovo has strong military background. Liu Chuanzhi has good relationship with Alibaba’s Jack Ma, and was also one of the founders of Hupan University, which was forced to change its name a while ago when Alibaba was cracked down and Ant Group’s IPO was hauled.
Didi’s shareholders include many national level giants, such as Bank of Communications, China Merchants Bank, Poly Capital, China Life, CICC Capital, China International Trust Investment Corporation (CITIC) and Ping An, each of which has one or more powerful red families behind it.
In addition, Didi also has investment from Boyu Capital, Sequoia Capital, Hill House and Softbank, all of which are private equity giants, especially Softbank, which is the largest shareholder of Didi.
In other words, Didi is basically a huge platform supported by the CCP's heavyweight princeling families in conjunction with international capital giants, with Liu Qing as a front person. What's more, these princelings, whether they belong to the Jiang Zemin faction, Hu Jintao or Zhu Rongji factions, do not seem to be in the same boat as Xi Jinping.
So, some people are saying the Didi will face severer crackdown compared to Alibaba.
Battle over who controls the data has been going on for a while. The CCP doesn’t want the internet giants to control the data, as the CCP itself wants absolute control. Anti-monopoly, protecting customer privacy is just an excuse for the CCP.
7/6/2021 *
