The partnership deal with Geely goes beyond the production of cars. In this new venture, Baidu will take full control or absolute power and the majority stake of the company.
Baidu Inc (NASDAQ: BIDU), a Chinese Search heavyweight has announced to move from the production of mere software to the production of electric vehicles. This will be done by collaboration with Chinese Automaker, Geely Automobile Holdings Ltd (OTCMKTS: GELYF). According to the report, Geely will be in charge of the manufacturing and the designing of the car while Baidu controls the smart driving technologies.
This initiative will bring more competition into the industry with Tesla Inc (NASDAQ: TSLA) already facing stiff competition from the likes of XPeng Inc (NYSE: XPEV) and Li Auto Inc (NASDAQ: LI). This move is similar to the previous action taken by Alibaba Group Holdings Ltd (HKG: 9988) in partnership with SAIC motor to produce electric cars.
Baidu has for the past couple of years shown interest in the industry by testing autonomous driving. They have also successfully launched a robotaxi fleet.
Its Apollo ecosystem or Android for Smart Driving has been able to find interest among several partners in the manufacturing and supplying industry. Under the newly announced initiatives, Apollo and Baidu maps will provide capabilities while Geely plays its role as a strategic partner according to reports. The sales, manufacturing, development, research, vehicle design, and services forming the industrial chain would be taken care of by the firm.
According to Robin Li, the co-founder and Chief Executive Officer of Baidu, they have for the past decade invested heavily in Artificial Intelligence in a bid to boast of records of work class self-driving services with their belief in the future of intelligent driving. In his statement, he disclosed that this partnership will make way for passenger vehicles in the future.
“We believe that by combining Baidu’s expertise in smart transportation, connected vehicles, and autonomous driving with Geely’s expertise as a leading automobile and EV manufacturer, the new partnership will pave the way for future passenger vehicles, ” he said.
The situation of whether the partnership with Geely will affect the operation of Apollo is yet unknown, however, Baidu mentioned in their statement that they will open their gate for partnerships from other giants in the Artificial Intelligence industry.
The partnership deal with Geely goes beyond the production of cars as claimed by other reports. In this new venture, Baidu will take full control or absolute power and the majority stake of the company.
China leads the electric cars market globally with a report revealing 47% of electric cars on the Chinese road out of the 7.2 million electric vehicles globally in 2019. It was reported that by 2025, China will see a 20% composition of the total new vehicle. Li in a previous statement revealed that China has become the world-leading market for electric vehicles, and consumers are in constant demand for generation vehicles to be intelligent.
Excellent John K. Kumi is a cryptocurrency and fintech enthusiast, operations manager of a fintech platform, writer, researcher, and a huge fan of creative writing. With an Economics background, he finds much interest in the invisible factors that causes price change in anything measured with valuation. He has been in the crypto/blockchain space in the last five (5) years. He mostly watches football highlights and movies in his free time.