"If you want to do well in this industry, if you can't surpass Didi, you will not be successful", Li Shufu, chairman of Geely Holding Group, once said to Cao Cao's travel management.
However, Cao Cao's trip did disappoint Li Shufu - according to his application for IPO in Hong Kong submitted a few days ago, the huge gap between him and Didi in terms of income, gross margin, net profit, etc. was revealed.
Although claiming to be the third place in the online car hailing market, Cao Cao's travel market share is only 4.79%, even less than that of Didi. From 2021 to 2023, Cao Cao will also lose money in successive years. Even on the compliance of B2C mode with advantages, Cao Cao's travel also has huge hidden dangers. In 2023, there will be nearly 50000 vehicles and nearly 50000 drivers on its platform who have not yet obtained compliance certificates, accounting for more than 15%.
Cao Cao, who wants to go public, cannot tell a new story about online car hailing.
Huge losses! Gross profit rate "as thin as paper"
Cao Cao is the incubator of Geely Group, mainly adopting B2C mode, which can digest the inventory of Geely Group cars on the one hand, and improve the service level on the other hand.
Cao Cao Chuxing also cooperated with Geely Group to deploy customized cars. According to the data published in the prospectus, as of December 31, 2023, it has a fleet of about 31000 customized cars in 24 cities, the largest in China. Although Cao Cao Chuxing claims that the deployment of customized cars can achieve high cost-effectiveness, it has not helped Cao Cao Chuxing to become profitable.
The data shows that from 2021 to 2023, the total revenue of Cao Cao's travel will be 7.152 billion yuan, 7.631 billion yuan and 10.668 billion yuan, with year-on-year growth of 66.4%, 6.7% and 39.8% respectively; But at the same time of revenue growth, the company fell into consecutive losses. From 2021 to 2023, Cao Cao's net travel losses will be 3.007 billion yuan, 2.007 billion yuan and 1.981 billion yuan respectively, with a total loss of 6.995 billion yuan; Under non IFRS, the adjusted net loss was 2.959 billion yuan, 1.651 billion yuan and 966 million yuan respectively.
Li Shufu, chairman of Geely Holding Group, had high hopes for Cao Cao's travel: "If you want to do well in this industry, you will not succeed if you can not surpass Didi."
However, it is embarrassing that Cao Cao's travel is far from Didi's size. Take 2023 as an example, the total revenue of Didi is 192.4 billion yuan, and the revenue of Cao Cao's travel is only 5.5% of that of Didi; Didi had a net profit of 540 million yuan, while Cao Cao Chuxing had a loss of 1.981 billion yuan.
The gross profit rate of Cao Cao's travel is also not optimistic. From 2021 to 2023, the gross profit rate of Cao Cao's travel will be - 24.4%, - 4.4% and 5.8% respectively. Although it will change from negative to positive in 2023, it has no advantage over its peers. For example, for Didi with C2C model, the gross profit margin from 2021 to 2023 will be 9.7%, 17.8% and 15.3% respectively; However, the gross profit margin of Dida Travel, which focuses on the tailwind business, was 80.9%, 75.1% and 74.3% respectively.
Buying volume? It costs nearly 700 million a year
In recent years, Gaode, Meituan, Baidu and others have entered the integrated taxi mode, and become important players in the online car hailing market with a large number of users.
Cao Cao chose to hold the legs of the platform of aggregation travel. Data shows that the dependence of Caocao Travel on the aggregation travel platform has increased year by year. From 2021 to 2023, the GTV of Caocao Travel's self aggregation platform received orders were 3.9 billion yuan, 4.4 billion yuan and 8.9 billion yuan, respectively, accounting for 43.8%, 49.9% and 73.2% of the total GTV in the same period.
Cao Cao Chuxing said that the order scale has been rapidly improved through various aggregation platforms. In the future, he also plans to further strengthen cooperation with the aggregation platform to obtain more extensive user traffic and maintain the growth of order volume.
However, the traffic of aggregation travel platform also needs to be paid.
The data shows that the income of Cao Cao's travel will increase by 39.8% from 7.6 billion yuan in 2022 to 10.7 billion yuan in 2023, while the sales and marketing expenses will also increase by 30.8% from 639 million yuan in 2022 to 836 million yuan in 2023. Cao Cao said that the commission paid to the third-party aggregation platform increased by 107.4% from 322 million yuan in 2022 to 667 million yuan in 2023.
Cao Cao Chuxing was also frank in the prospectus, relying on a third-party aggregation platform to handle a large number of orders, but the aggregation platform industry may be integrated. If Cao Cao Chuxing can only choose from a few aggregation platforms that can provide the required user facilitation services, he may have to accept adverse terms due to limited bargaining power. In addition, if the cooperation between Cao Cao Chuxing and the third-party aggregation platform is interrupted, the number of orders that can be served may be greatly reduced, and there is no guarantee that an alternative aggregation platform can be found in time according to acceptable terms, or that an alternative aggregation platform can not be found at all.
In addition, Cao Cao Chuxing is not only responsible for paying for traffic from the aggregation platform, but also responsible for resolving disputes between drivers and users caused by orders from the aggregation platform. If the aggregation platform has to bear responsibility or be subject to administrative punishment due to accidents in the process of fulfilling the order, the aggregation platform also has the right to claim any economic losses from Cao Cao Chuxing.
Third? The market share is less than 5%
Cao Cao Chuxing said in the prospectus that, according to Frost Sullivan's data and calculated by GTV, it has been ranked among the top three online car hailing platforms in China in 2021, 2022 and 2023.
However, the third place of Cao Cao's travel is not very valuable.
According to GTV, Didi's market share will reach 75.5% in 2023, ranking first; Cao Cao Chuxing, ranked third, has a market share of only 4.79%.
Cao Cao also wants to tell a new story. For example, in March 2023, Cao Cao Chuxing will directly leave the field to build and sell cars, and release the customized car brand Cao Cao Auto and its first model Cao Cao 60. According to the prospectus, from 2021 to 2023, its vehicle sales revenue will be 52.906 million, 32.184 million and 115 million, respectively, accounting for 0.7%, 0.4% and 1.1% of the total revenue, and the driving effect on revenue is not obvious.
From 2021 to 2023, travel service income will still be the main part of Cao Cao's total travel income, accounting for 96.3%, 97.9% and 96.6% respectively. In the prospectus, Cao Cao Chuxing also gave an extremely optimistic forecast of the future shared travel market, saying that the shared travel market is expected to grow rapidly, from 354.7 billion yuan in 2024 to 751.3 billion yuan in 2028.
But this is not the case.
Recently, many transportation management departments across the country have issued risk warnings for online car hailing industry, publicly reminding potential investors and practitioners to consider carefully entering the online car hailing industry. Relevant data shows that the transport capacity of online car hailing market has approached or exceeded the actual demand in many places. According to the data disclosed by the transportation management department, the multi grid car hailing platform has not been operated, the number of vehicles is less than 50, and the daily average number of orders is less than 1000. At the same time, the daily average number of orders received by online car hailing practitioners does not exceed 20, and the average revenue per time is about 20 yuan, resulting in an average daily income of only 200 yuan per car.
On the one hand, the online car hailing market is becoming saturated; On the other hand, the current layout of Caocao Chuxing is also mainly in the first and second tier markets. The prospectus shows that as of December 31, 2023, Caocao Chuxing has operating networks in 51 cities in China, but currently it is mainly concentrated in the first and second tier cities, which is also the reason why its market share and income scale have a huge gap with Didi.
In addition, although B2C mode is adopted, there are also problems in the compliance of Cao Cao's travel.
The prospectus disclosed that, as of December 31, 2023, some vehicles and drivers on Cao Cao's travel platform had not yet obtained the necessary transportation permits and network reservation taxi driver's licenses. From 2021 to 2023, there will be 53111, 34153 and 48247 vehicles in Caocao, accounting for 23.0%, 15.8% and 15.7% of the total number of vehicles; At the same time, 62101, 38433 and 47896 drivers have not yet obtained driving permits for online car hailing, accounting for 27.0%, 18.0% and 15.7% of the total number of drivers, respectively.
Cao Cao Chuxing is frank in the prospectus that if the drivers or vehicles on Cao Cao Chuxing fail to obtain and maintain the licenses or permits required for providing online car hailing services, their business, financial status and operating performance may be significantly adversely affected. The platform may be subject to administrative penalties, including orders to correct and fines, or may be ordered to suspend, terminate or significantly reduce operations.
