The Baidu Inc. logo will be displayed at the company’s headquarters on July 3, 2019 in Beijing, China.
Wan Xiaojun | Visual China Group through Getty Images
GUANGZHOU, China – Chinese internet giant Baidu has formed a strategic partnership with automaker Geely to create an autonomous unit for electric vehicles, the companies confirmed on Monday.
The new unit will operate as an independent subsidiary of Baidu, the company said on Monday.
CNBC first reported on Friday, citing a person familiar with the matter.
Beijing-based Baidu will be the majority shareholder, while Chinese automaker Geely will have a minority stake, the person told CNBC.
Hong Kong-listed Geely shares rose slightly by 0.45% on Monday, after rising almost 20% on Friday. US listed Baidu shares rose more than 15% at the close of Friday’s trading session.
Geely will be responsible for the actual manufacture of the vehicles. Baidu will focus on the car’s software and technology. The search giant has already tested its driverless car software, called Apollo, in public robot taxi tests in Beijing.
Baidu also has its own map and voice assistant technology app called DuerOS, which can be equipped inside a vehicle.
China’s electric vehicle market continues to grow, helped by government support such as subsidies and building charging infrastructure.
Domestic electrical automaker Nio, Li Auto and Xpeng Motors all reported an increase in deliveries in December. Baidu hopes to step into the action of electric vehicles.
“China has become the world’s largest market for EVs (electric vehicles), and we are seeing EV consumers demanding that next generation vehicles be smarter,” said Robin Li, Baidu’s CEO, in a statement.
The electric car market continues to become more competitive, with companies increasing production and launching new vehicles.
On Saturday, Nio launched its first sedan called et7. IPhone maker Foxconn has signed an agreement with Chinese electric car maker Byton to help produce its first vehicle.