Baidu Inc. is 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 electric vehicle unit, the company confirmed Monday.
The new unit will operate as an independent subsidiary of Baidu, the company said on Monday.
CNBC first reported the news on Friday, citing a person familiar with the matter.
Beijing-based Baidu will be the majority shareholder, while Chinese carmaker Geely will take a minority stake, the person told CNBC.
Geely’s Hong Kong-listed shares rose slightly by 0.45% on Monday, after rising by almost 20% on Friday. Baidu’s US-listed shares rose more than 15% at the close of trading on Friday.
Geely will be responsible for the actual manufacture of the vehicles. Baidu will focus on in-car software and technology. The search giant has already tested its driverless car software, called Apollo, in the public robotaxi tests in Beijing.
Baidu also has its own mapping application and voice assistant technology called DuerOS, which can be equipped inside a vehicle.
China’s electric vehicle market continues to grow, aided by government support, such as subsidies and the construction of charging infrastructure.
National carmaker Nio, Li Auto and Xpeng Motors all reported an increase in deliveries for December. Baidu hopes to take action on electric vehicles.
“China has become the world’s largest market for electric vehicles (electric vehicles) and we see electric vehicle consumers demanding next-generation vehicles to be smarter,” Baidu CEO Robin Li said 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. Apple iPhone maker Foxconn has signed an agreement with Chinese electric car maker Byton to help produce its first vehicle.