You wait forever for a better version of taxi services, and suddenly there are too many. Certainly that has been the case in China, where fierce rivalry has led to the exit of US leader Uber.

But no one has told Chinese carmaker Geely that. On Wednesday it was reported that Daimler and unlisted Zhejiang Geely Holding are working on a ride-hailing joint venture in China. The share price of Geely’s subsidiary, Geely Automobile, jumped as much 6 per cent, although it fell back later. Given their awkward relationship — Geely surreptitiously became the largest shareholder of the German brand via a derivatives deal in February — just who will lead this venture is not clear. The home governments of both companies are tightening emissions rules. Ride-hailing might help meet those goals. But the focus is likely to be on China, the larger market. Just over a tenth of Daimler’s car sales are there.

No matter, this endeavour faces serious challenges. Ride-hailing is a notorious cash burner. In China, well-funded Uber had to admit defeat to rival Didi in 2016. Both have financial backing from Japan’s SoftBank Group. The business requires huge scale.