Apple just invested in Uber's biggest rival for a pile of cash

Apple Didi Chuxing Uber news

There's no Apple Car announcement yet, but Apple just made a major automotive investment in the biggest rival to Uber today.

Didi Chuxing Technology is China's top ride-hailing service and Apple added to its exploding value with a $1 billion investment (about £693m, AU$1.37b), reports the Wall Street Journal.

The Beijing-based taxi-for-hire company is said to be worth $25 billion, thanks to the backing of Alibaba (the Amazon of China) and Tencent Holdings (the Facebook of China).

You may have thought ride-hailing app challenger Lyft in the US was Uber's top competitor, but it's Chuxing Technology, the company you've probably never heard of. Yet it operates in over 400 cities in China vs Uber's 45 on the Mainland.

Two reasons Apple Didi the deal

Apple's investment in Didi Chuxing is very telling about where the company thinks the future of car tech is headed. Electric vehicles, self-driving cars and ride-hailing apps are its three pillars.

All three of these categories will merge, likely when Apple debuts its rumored EV car and Google is finished tinkering with its self-driving car in a few years.

Apple buys Uber rival news

Uber is also investing in creating a self-driving EV fleet, and China's LeCo and its US-based subsidiary Faraday Future have similar ambitions in order to rival Tesla's ambitious 5-year plan for a self-driving car.

There's a second, more-immediate reason Apple may want Didi Chuxing: some of its key businesses are being shut down by the Chinese government right now.

You can no longer buy iBooks and iTunes Movies in Mainland China, and even its own iPhone trademark has been suspended. Remaining a major player in China is essential for Apple's reversing fortunes in the latest quarter.

A rare Apple power move

With the exception of its Beats acquisition, Apple never makes anything close to a $1 billion stake in companies, and this is also Didi Chuxing Technology's largest single investment yet.

Power moves like this are rare for Apple. It tend to buy smaller startups or acquire their unheard of tech (like it did with Siri) before they become household names.

Apple CEO Tim Cook telegraphed this move 10 days ago, saying Apple is "always looking" to make acquisitions in services and deals happen "every three to four weeks on average."

The iPhone 7 and iPhone 7 Plus are going to remain Apple's most lucrative products, but it's clear that the company is looking outside of its normal categories to drive growth again.

Matt Swider