Chinese transport authority agrees that heavy rebate in chauffeured service competition is not sustainable.
The transport minister said on Monday that ride-hailing companies like Didi Kuaidi and U.S. firm Uber Technologies Inc subsidizing discounts and supplementing driver wages was competitively unfair and not sustainable.
Those subsidies would not be sustainable in the long-term, said Chuantang Yang, speaking to reporters on the sidelines of China's annual parliamentary session.
Companies like Didi Kuaidi and Uber are spending billions of dollars in heated competition, using investors' money to fund discounts for users and drivers on their apps.
The minister previously announced that the provisional rules on car-hailing service had been drafted while reiterating this does not necessarily mean legitimization of the business.
While Uber is profitable in the U.S., it's losing over a billion dollars a year in China.
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