Despite rumors about a possible merger between bicycle-sharing platforms Mobike and Ofo, Mobike co-founder and chief executive Davis Wang Xiao-feng declared that “a merger is not an option for the company”, China Daily reports.
The same sentiment was earlier expressed by Ofo founder and CEO Dai Wei, who said his company would not consider a merger.
Speaking at The Year Ahead Summit hosted by Bloomberg Businessweek on Wednesday, Wang said Mobike has been focusing on product differentiation and users’ emotional connections with the brand rather than a merger.
“Without a strong differentiation from similar products, the users will eventually abandon you,” he said. “If an enterprise can make more efforts in improving its products and brand, it will win the favor of customers.”
Expecting more differentiated products in the highly competitive mainland market, Wang believes Mobike can survive independently after establishing users’ trust through product differentiation and emotional bonding.
“People mention mergers a lot because these two things are not perfectly done by the companies, therefore they are not able to survive independently,” Chinese media TMT Post reported.
While competition between Mobike and Ofo has been fierce, rumors about their possible merger have been buzzing for quite a while.
Zhu Xiaohu, an early stage investor of Ofo, said in September that the landscape in China’s bike rental industry has been settled with Mobike and Ofo accounting for 95 percent of the market.
Zhu said both firms still need huge funding for their operations and only a merger could make them profitable. This statement is widely interpreted as a proposal for a union.
The two bike-sharing giants have started making global expansion plans this year, with the goal of gaining a foothold in about 200 cities around the world.
In fact, Berlin became the 200th city in Mobike’s global network on Nov.22 after the company launched the service with 700 bikes in the German capital, Yicai Global reported, citing Wang.
Ofo, which has established a presence in 19 countries, announced on Wednesday an agreement to explore the India market.
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