Hong Kong (CNN Business)Uber and Didi are rolling out cab-hailing services across Japan as they eye the bonanza of tourists expected at this year's Rugby World Cup and the 2020 Tokyo Summer Olympics.
In Japan, "our Eats business is much more relevant and acceptable ... the growth there has been extraordinary," said Brooks Entwistle, Uber's chief business officer.
Uber Eats launched in Tokyo in 2016 with 150 restaurants on the app. It now operates in 10 cities and has partnerships with more than 10,000 restaurants.
But neither company will find it easy to take business away from Japan's traditional taxis.
Private car owners are prohibited from carrying passengers for fares in Japan, meaning the ride-hailing firms have to team up with taxi companies to offer their services.
And the highly fragmented nature of the market will also work against the newcomers, according to a recent report by McKinsey. Small companies with 10 cabs or fewer make up 90% of the national fleet.
"Because of this fragmentation, providers of e-hailing apps ... must work with multiple operators to capture a large enough user base and fleet network," the report said.
Didi said it has more than 50 taxi partners in Japan, compared to 13 for Uber. Both firms have invested in training Japanese taxi drivers on how to use their apps on smartphones.
"It is a fight to have a stake in somebody, then have them come in and beat the crap out of you," said Entwistle.
Didi is unapologetic about pushing into markets where Uber has already planted a stake.
"We want to offer a solution to satisfy the needs of local customers," said Zheng Bu, Didi's chief security officer and vice president of international business technology. "Our focus is not about competition, it's not like 'what they have, we will follow.'"
Didi is tailoring its app for taxi drivers in Japan, who are often dressed formally in a suit, hat and white gloves. It unveiled a new feature last week that allows Japanese drivers to accept rides using their voice, rather than having to take off their gloves to swipe a smartphone screen.