It has been announced on Tuesday that Volvo Cars and Baidu have joined forces to develop and produce autonomous electric cars in China.
The Swedish marque, which is a unit of Chinese Zhejiang Geely Holding Group, will provide its expertise in the latest automotive technologies, while Baidu will let its partner use its Apollo self-driving platform.
Both companies have a big goal for China, namely to build and market autonomous cars that meet SAE International’s Level 4 driving automation standard. It means that those vehicles don’t need control inputs from a human in certain circumstances.
Neither of the two companies have revealed the financial details of the deal. Volvo only says that with Baidu it takes a major step towards improving its commercial capability in selling its self-driving compatible vehicles, which are “built on Volvo’s industry-leading safety technology”.
Volvo boss Hakan Samuelsson stated his optimism about the Chinese market, where the internet giant Baidu is a big player. There, autonomous drive sees rapid development and opportunities are open for the Swedish automaker to become an important autonomous fleet supplier.
Baidu chose Volvo as a partner not without reason, it praises the automaker’s “long-standing safety credentials.” Since it was founded a century ago, Volvo has made safety is number one priority, developing safety features that are increasingly innovative.
Baidu’s president Ya-Qin Zhang sees this partnership with Volvo as a strategic one. He believes that Volvo’s cars and Baidu’s self-driving technology will make a perfect combination, providing “the world with the safest auto products for the benefit of humankind.”
China is undoubtedly a very potential country for autonomous vehicles to grow and expand. There are several technology companies that compete in this sector, including Baidu, Tencent and Didi Chuxing.
Not just domestic tech firms, but multiple European automakers (including Volvo) also vie to seize the biggest space in China, with Daimler being the first one to get ok for testing driverless cars in Beijing.
As the biggest search engine in China, Baidu is also increasingly known in the West, pushing fields like machine intelligence and autonomous driving beyond its home market. Recently, the company has also established a two-year partnership with US automaker Ford that would allow the two to jointly develop and test self-driving cars by the end of the year.
With Baidu onboard, Volvo expects to make a third of its annual sales from autonomous cars by 2025. Last week, the company reported that its third-quarter net income declined to 1.84 billion Swedish krona or around $201.7 million, which is 50 percent lower than last year.
It’s not yet clear when Volvo and Baidu will debut their self-driving cars, but the latter stated that both companies aim to start production in the next few years.