The Baidu Inc. logo is shown 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 carmaker Geely to set up an independent electric vehicle unit, the companies confirmed Monday.
The new unit will operate as an independent subsidiary of Baidu, the company said Monday.
CNBC first reported the news Friday, citing someone 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 0.45% on Monday, after firing close to 20% on Friday. Baidu’s U.S.-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 car software and technology. The search giant has already been testing its driverless vehicle software, called Apollo, in 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.
Domestic electric car maker Nio, Li Auto and Xpeng Motors reported an increase in deliveries in December. Baidu hopes to initiate some action on the electric vehicle.
“China has become the world’s largest market for electric vehicles (electric vehicles) and we see that electric vehicle consumers demand that next-generation vehicles be smarter,” Robin Li said. CEO of Baidu, in a statement.
The electric car market continues to be increasingly competitive as companies increase production and launch of new vehicles.
On Saturday, Nio launched its first sedan called the et7. Apple-based iPhone maker Foxconn has signed a deal with Chinese electric vehicle maker Byton to help produce its first vehicle.