"It will be challenging for the newcomer to grab share from the existing players," Huang said. "But given Uber's global presence and their success in other markets, the existing players cannot really take the competition from Uber lightly."

Didi Kuaidi declined to comment on Uber's plans to invest in China and on its own plans for driver and consumer incentives.

Huang Xue, Uber's China spokeswoman, declined to comment on details of its expansion in the country.

For taxi driver Chen Hairu, who has been driving for seven years in Beijing, the rising popularity of private car-booking is prompting him to think about a career change.

"Maybe it's time for me to become a private-car driver for hire, but I don't know how to become one," said Chen, 42, who took in about 200 yuan during a recent five-hour shift.

"I heard there's a foreign company that gives drivers a lot of money. I need to find them."