Amid raids, Uber's Kalanick strikes conciliatory tone in China

By Paul Carsten and Adam Jourdan GUIYANG, China/SHANGHAI, May 26 (Reuters) - Uber Technologies Inc is leading a charm offensive in China even as the controversial U.S. ride-hailing app valued at $40 billion battles with raids on its offices and a crackdown on its drivers deemed to be operating illegally. Speaking at a technology conference in southern China, CEO Travis Kalanick called on local governments and leaders to work in collaboration with Uber, a conciliatory tone mirroring that taken by the leaders of Microsoft Corp and Qualcomm Inc , which have also recently come under scrutiny in China. "Everything we do is focused on making cities better. The benefits come to cities when Uber works with local government and local leaders to make this progress a reality," he said, adding Uber had created over 60,000 jobs across China in just the last month. People with knowledge of the matter said Uber has been actively trying to forge closer ties with local governments in China in a bid to fend off protests by local taxi firms, raids on its offices and well-connected local rivals. Taxi firms are often closely connected to local authorities and provide a source of revenue for provincial governments. China's dominant taxi-hailing firm Didi Kuaidi - backed by Internet giants Tencent Holdings Ltd and Alibaba Group Holding Ltd - has played up its more local credentials, announcing a tie-up with Shanghai authorities this month. At stake for the players is what's estimated by analysts to be the world's largest transport market, with more than 150 million Chinese hailing taxis using their smartphones. RAIDS, CRACKDOWN Uber, which has come under the spotlight in markets from the United States to Australia, has seen its office raided in China's southern metropolis Guangzhou during the past month. The company, which has a tie-up with local Internet giant Baidu Inc, is suspected of conducting illegal business by allowing private car owners to offer taxi services, the official Xinhua reported this month. Uber has not commented specifically on the raids. To be sure, Uber is not the only firm to have drawn regulatory attention. Apps used to hire private cars, as opposed to licensed taxis, have more widely met with resistance from some China regulators, which have said the business is illegal. Didi Kuaidi's offices have also been raided. Uber has also been struggling to find a candidate to lead the firm's operations in the world's No. 2 economy, two people with knowledge of the situation said. Uber's China-based spokeswoman Xue Huang said the firm had been formally looking for a China head for a "few months". (Writing by Adam Jourdan; Editing by Muralikumar Anantharaman)