Uber Is Back in China: But for Making Bikes, Not Ride-Hailing

(Bloomberg) -- Two years after exiting China, Uber Technologies Inc. is putting feet back on the ground. Staff there, however, aren’t working on the ride-hailing company’s main business, but overseeing the creation of its bikes and scooters — Uber’s bet for its next consumer hit.

After buying Jump Bikes, a U.S. bike-rental service, Uber is set to unveil its own scooter, plunging into a chaotic new transit market. Uber is adding supply chain, recruiting and other personnel in southern China to work closely with the manufacturers of these devices, according to Rachel Holt, head of Uber’s New Mobility unit.

She also said the San Francisco-based company may launch these services in Asian countries, such as Japan, where Uber has limited operations because of regulatory reasons. “We absolutely have global aspirations here,” she said at an event on Friday in Hong Kong.

Those plans, however, won’t include mainland China anytime soon. Uber sold its operations there to Didi Chuxing in 2016 after suffering heavy losses. And China already hosts a thicket of e-bike companies in cutthroat competition. Holt admitted that Uber has no immediate plans for similar services in China.

Uber will continue to invest in the nation’s supply chain, Holt said, despite the mounting political costs. Both e-bikes and scooters are included in the Trump administration tariff list, adding a 25 percent tax on each component that Uber imports. Holt declined to name manufacturing partners, but suggested that Uber’s volume would be significant. “We have the potential to be a very, very large customer for them,” she said.

The executive also hinted that Uber’s new scooters will rely on a different assembler than those of rivals, such as Bird and Lime, whose scooters have sprung up overnight in U.S. cities. “Everyone is using the same scooter,” Holt said. “But it’s not being designed for the way it’s being used, and that’s why you’re seeing these scooters lasting for only a couple of months.”

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