Uber is getting dwarfed by its Chinese rival, which gives 3 million rides a day

REUTERS/Kim Kyung-Hoon

Uber passengers in China are taking a million trips every day.

Four of Uber's 10 biggest cities are in China, CEO Travis Kalanick told investors in an email obtained by the Financial Times last month.

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Uber operates in 11 Chinese cities, with plans to launch in 50 more cities with a population of 5 million people or more this year.

But Uber faces stiff competition in China in the form of a company called Didi Kuaidi. It was created in February when competing apps Kuaidi Dache and Didi Dache merged to cut the costs of competing with each other - and more importantly, Uber.

In a leaked memo to investors last week, Didi Kuaidi CEO Cheng Wei said that his company is processing 3 million trips in China every day. That's three times the number of rides Uber is giving throughout the country.

Cheng, whose company is raising $1.5 billion at a $15 billion valuation, also said in the leaked memo that the 3 million figure is triple the number of rides Didi Kuaidi was doing in May.

Uber is increasingly ubiquitous internationally - it operates in more than 300 cities globally. It would appear that for now, at least, Uber is still being dwarfed in China as Didi Kuaidi dominates the Chinese market. Though it runs two separate apps (Didi and Kuaidi), both share the same core technology and data. Didi Kuaidi accounts for 78% of ride bookings in China, according to industry researcher Analysys International, while Uber accounts for only 11%.

South Korea has charged Uber CEO Travis Kalanick with operating an "illegal" taxi service, and has vowed to shut down Uber's operations in the country. As TechCrunch notes, "Korean law doesn't allow technology companies to store payment data as part of their purchase workflow, but instead requires consumers to retype their information with every purchase, ostensibly for security reasons."

And previously, Uber's China offices were raided by police in what was described as a crackdown on ride-hailing apps. China's taxi market is largely state-owned, and the International Business Times reports some Chinese citizens have been angered by taxi drivers opting to switch over to apps like Uber, because it makes it more difficult to simply hail a cab on the street.

To give Uber credit, though, it's still growing like crazy in the country. Uber's service is taking off in China much faster than it did in the United States. Nine months after launching in Chengdu, Uber has 479 times the trips it had in New York after the same amount of time.

Uber

And Uber is putting a lot of money into its Chinese growth. Uber has previously raised more than $5 billion in several funding rounds, including a $600 million investment from Chinese search engine company Baidu.

Uber certainly already has a leg up on its US rivals: Lyft, perhaps its closest competitor, hasn't even expanded outside the States yet. But if Uber wants to achieve global expansion, it needs to work within the legal regulations in the Asia-Pacific area as well as work to make its Indian customers happy.