Geely's ride-hailing unit Cao Cao Mobility raises $589M Series B to upgrade tech and expand fleet

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Cao Cao Mobility, the ride-hailing unit of Chinese automaker Geely Automobile Holdings, has announced a $589 million (RMB 3.8 billion) Series B raise that the company says will help it upgrade its technology and expand its fleet, according to a statement released by the company (in Chinese).

The raise, which Cao Cao announced on Monday, brings the company's total funding to around $773.2 million (RMB 5 billion). Suzhou Xiangcheng Financial Holding Group, an investment company backed by the Xiangcheng district government of Suzhou, led the round along with Suzhou High-Speed Rail New City Group and three other state-controlled enterprises.

This raise comes amid troubles for Cao Cao's biggest competitor, Didi Global, the Chinese ride-hailing app that's currently under cybersecurity investigation by the Chinese government and has been temporarily removed from Chinese app stores causing stocks to plummet. Didi has been a ride-hailing staple in China, so any setbacks can create a vacuum that others in the space will try to fill.

Cao Cao, which is currently available in 62 cities in China, saw ride volume increase 32% in July, the same month Didi was taken down from app stores in China. Meituan, China's e-commerce giant, also saw a 24% ride increase in July, according to the Ministry of Transport. However Meituan and Amap, Alibaba's ride-hailing and navigation unit, are being criticized alongside Didi by the Chinese government for "disrupting fair competition and hurting the interests of drivers and passengers," reports Bloomberg.

As all of the other players in the ride-hailing sphere struggle under government scrutiny, Cao Cao is positioned for further growth and a larger market share, as long as it is found to be playing fair.

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