GUANGZHOU, China — Chinese search large Baidu will create a standalone electrical automobile firm, an individual acquainted with the matter advised CNBC.
The Beijing-headquartered firm would be the majority shareholder whereas Chinese automaker Geely will take a minority stake, the particular person stated. Geely will probably be chargeable for manufacturing the automobiles whereas Baidu will deal with the software program behind the automotive.
Baidu and Geely declined to remark when contacted by CNBC.
Hong Kong-listed shares of Geely have been up greater than 13% after Reuters first reported the information.
Baidu depends closely on promoting income however it has been trying to diversify its enterprise to different areas equivalent to cloud computing and autonomous driving software program, areas that analysts see as promising for the corporate.
The firm has already been testing its driverless automotive software program, named Apollo, in public robotaxi trials in Beijing. Baidu additionally has its personal map app and voice assistant know-how referred to as DuerOS, which will be outfitted inside a automobile.
China’s electrical automotive market continues to develop, helped by authorities assist within the type of subsidies and charging infrastructure.
Sales of pure electrical automobiles from January by November rose 4.4% from a yr in the past, versus a decline of seven.6% in general passenger automotive gross sales throughout the identical time, in accordance with China’s Ministry of Industry and Information Technology.
Baidu will probably be leaping into an more and more aggressive market competing with the likes of Tesla in addition to home electrical automobile corporations equivalent to Nio, Li Auto and Xpeng Motors.
The latter three corporations all not too long ago reported a surge in automotive deliveries for December.
China’s tech giants have all been investing in electrical automobiles or auto-related know-how. Alibaba is an investor in Zhiji, an electrical automobile enterprise created by Chinese state-owned carmaker SAIC Motor.
Meanwhile, ride-hailing agency Didi launched its personal electrical automobile with automaker BYD, which is backed by billionaire Warren Buffett.
Elsewhere, Hyundai Motor stated it was in early-stage discussions over a tie-up with Apple to make a automotive.