China’s largest ride-sharing company now offers driver loans and insurance

Ride-sharing giant Didi Chuxing is taking out an insurance policy against Chinese regulations that threaten to drive it off the road.

Yesterday, Didi announced that it will offer drivers lending services and health and car insurance policies (all within its app) to incentivize more workers to join the gig economy.

Right now, Didi needs drivers more than drivers need them

TechCrunch explains that Chinese regulations started requiring gig drivers to carry both difficult-to-obtain local residency permits and costly commercial driving licenses starting on Jan. 1.

Didi already offered pre-licensed vehicles to lower initial costs for its drivers, but new laws (and new competitors) have them swerving to avoid disaster: In 2019, Didi will offer additional discounts on buying and leasing “new energy vehicles” through its partners.

Meanwhile, all these incentives are eating into their bottom line

Back in September, Bloomberg reported that Didi lost $585m in the first half of 2018, due to $1.7B in subsidies such as driver and rider discounts, capping off 6 unprofitable years since its founding in 2012.

For now, Didi’s loss is drivers’ gain — but the question is: How far can Didi go before it runs out of gas?