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Exclusive-China search giant Baidu considers making own electric vehicles

Stock MarketsDec 15, 2020 06:50AM ET
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© Reuters. FILE PHOTO: A logo of Baidu is seen during the World Internet Conference (WIC) in Wuzhen

BEIJING (Reuters) - China's Baidu Inc (NASDAQ:BIDU) is considering making its own electric vehicles and has held talks with automakers about the possibility, three people with knowledge of the matter said, the latest move in a race among tech firms to develop smart cars.

The search-engine leader, which also develops autonomous driving technology and internet connectivity infrastructure, is considering contract manufacturing, one of the people said, or creating a majority-owned venture with automakers.

The initiative would be a step up from internet peers such as Tencent Holdings (OTC:TCEHY) Ltd, Amazon.com Inc (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOGL) Inc, which have also developed auto-related technology or invested in smart-car startups.

Baidu has held preliminary talks - without reaching any decisions - with automakers including Zhejiang Geely Holding Group Co Ltd, Guangzhou Automobile Group Co Ltd (GAC) and China FAW Group Corp Ltd's Hongqi, on a possible venture, the people said.

They declined to be identified as the talks are private.

Baidu declined to comment. GAC said it has a strategic partnership with Baidu and that any further cooperation was subject to discussion. Geely said it was not familiar with the matter. FAW did not respond to a request for comment.

Baidu established autonomous driving unit Apollo in 2017. The unit mainly supplies technology powered by artificial intelligence and work with automakers such as Geely, Volkswagen AG (OTC:VWAGY), Toyota Motor (NYSE:TM) Corp and Ford Motor (NYSE:F) Co.

Baidu operates autonomous taxi service Go Robotaxi with safety drivers on board in Beijing, Changsha and Cangzhou, and plans to expand to 30 cities in three years. It gained approval last week to test five cars in Beijing without safety drivers.

Its talks regarding manufacturing come after Didi Chuxing last month launched a purpose-built van for ride-hailing services with automaker BYD Co (OTC:BYDDF) Ltd. Meanwhile, tech giant Sony Corp (T:6758) in January unveiled an electric concept car with self-driving functions.

Building cars would represent a dramatic development in Baidu's push to diversify income streams as growth plateaus in its core search business, where revenue grew just 2% last year.

Baidu's Nasdaq-listed shares got a 5% boost in premarket trading. Shares of Geely's Hong-Kong-listed subsidiary, Geely Automobile Holdings (OTC:GELYF), were up as much as 5% in the afternoon. Shares of GAC rose about 1%.

Exclusive-China search giant Baidu considers making own electric vehicles
 

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Comments (3)
Usman Ibrahim
Usman Ibrahim Dec 15, 2020 1:34PM ET
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yet you're banning them
Rick Young
Rick Young Dec 15, 2020 11:48AM ET
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yea well untill our great AMERICAN investors quit takin $$ from china junk.they will keep makin it..we buy it??GREED its called
Pete Palella
Pete Palella Dec 15, 2020 1:05AM ET
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More china junk
David David
David9 Dec 15, 2020 1:05AM ET
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China is going to take over EV going forward...
Anakin Skwk
Anakin_Skwk Dec 15, 2020 1:05AM ET
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So, you are going to Short Baidu, Nio, Xpeng and Li Auto?
Joshua Sonoma
Joshua Sonoma Dec 15, 2020 1:05AM ET
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Everything you buy is "China junk" or have you been living under a rock?
Jack Zhang
Jack_A Dec 15, 2020 1:05AM ET
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your comment is junk
 
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