While Americans wait for their first autonomous taxis to roll through city streets, two Chinese companies have already dispatched driverless taxis in at least three Chinese cities, including Beijing and Shanghai.
Baidu, the Google of China, has establish a nationwide fleet of robo-taxis powered by Baidu’s inhouse self-driving technology called Apollo. It is currently offering free rides to the public as a promotional strategy, though the company recently indicated plans to begin charging and creating a recurring revenue stream.
The self-driving technology is expected to witness large-scale commercial application in the next five years, Robin Li, chairman and CEO of Baidu, told China Daily. Baidu has established a nationwide fleet of robo-taxis powered by Baidu's inhouse self-driving technology called Apollo.
Baidu is being challenged by DiDi Chuxing, the Uber of China. Didi is the largest ride-hailing service in China and deployed dozens of self-driving vehicles on the streets of Shanghai in June 2020, according to a report by Nikkei Asia, and is using fully autonomous taxis on a roads in the Jiading District on the outskirts of Shanghai. Early rides included a safety officer sitting in the driver’s seat during the trial.
In 2018, DiDi launched “D Alliance,” a ride-sharing corporate partnership that includes Toyota Motor and Volkswagen, according to Nikkei Asia, in hopes the alliance will accelerate the continuing development of self-driving vehicles.
James Yan, a reporter with The Economist, warned that if DiDi expands its robo-taxi fleet too aggressively it might cannibalize its existing human-operated ride hailing service. Because Baidu operates only robo-taxis (not to mention having multiple company revenue streams), it does not face that same risk of cannibalization.
Baidu is already listed on the NASDAQ and has international ambitions. A few months ago, the company received a permit from the State of California to test self-driving cars there.
“Whether Baidu’s robo-taxis can be rolled out in California and America is another question,” Yan commented. “The main impediments will be of a political variety. As Baidu gains prominence in America going forward, governments and consumers will start asking tough questions, like ‘how deep is the relationship between Baidu and China’s government? Will Baidu protect personal data?’ These are the sorts of questions that Baidu will have to grapple with in the years to come.”
More broadly, Jiang Zheng, a self-driving expert at China’s GAC research and development center, is quoted in China Daily asserting: “Autonomous driving is definitely the future development direction of the automobile industry. It not only solves traffic safety problems, but also greatly improves the efficiency of transportation, brings about economic benefits and liberates people from repetitive driving.”
Mike Consol (firstname.lastname@example.org) is editor of Real Assets Adviser. Follow him on Twitter @mikeconsol to read his latest postings.