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Baidu launches robotaxi enterprise after Beijing metropolis approves the fare

BEIJING – Baidu can begin collecting robot taxi fares in part of Beijing on Thursday, the Chinese tech giant told CNBC this week, marking an important step in building its driverless taxi business.

Government approval to support robotic taxis in China comes as local governments in the US have advanced in a similar direction.

However, the Beijing city move adds weight to it.

The Chinese capital’s approval marks the first time such a large city in the country has allowed companies to incriminate the public for robotic taxi rides.

It sets the stage for other cities like Shanghai, Guangzhou and Shenzhen to do the same, Wei Dong, vice president and chief security operation officer of Baidu’s Intelligent Driving Group, said in an exclusive interview with CNBC.

He expects these cities to act later this year or early next year.

How much will it cost?

Starting Thursday, Baidu’s Apollo unit, which runs the robotaxi business, will be able to collect fares from passengers who take one of 67 self-driving cars in Beijing’s suburb of Yizhuang.

While the company didn’t disclose exact prices, it said the tariffs would be comparable to the premium ride-hailing fees available through apps like Didi, which can cost twice as much as regular rides.

A security guard gets into a self-driving Robotaxi in Beijing, China, on October 13, 2020, a few days after Baidu started trial operations of its Apollo Robotaxi.

Zhao Jing | Visual China Group | Getty Images

Baidu has been offering free robot taxi rides in Yizhuang since October 2020. As of Wednesday, the Luobo Kuaipao-branded Robotaxi app showed a sample rate of 34 yuan ($ 5.31) for a 3-kilometer (1.86 mile) trip from a Sam’s Club in Yizhuang to a nearby subway station .

The same route costs about 14 yuan ($ 2.19) via Didi’s one-way express car service. Didi’s example fare for the same route is 27 yuan.

So far, the novelty of a free self-driving taxi has attracted a number of regular users in Yizhuang. Wei said more than 20,000 users make at least 10 trips a month each. It’s unclear how many will continue to use the service if they have to pay for it, but Wei plans to have an additional 100 Robotaxi cars verified each year.

Robotaxis race for USA, China approval

From the United States to China, robotic taxis are gaining traction with regulators who hold the keys to enabling the public to take driverless trips.

Self-driving taxi companies like Alphabet’s Waymo have tested similar products in the United States, mostly in California and Arizona. Waymo may collect fares from the public in any part of Phoenix, and its driverless vehicles do not require a safety driver.

On November 16, Alibaba-backed AutoX autonomous driving company claimed its fully driverless robotic taxis now operate in China’s largest single region – 168 square kilometers (65 square miles) in the Pingshan District of southern Shenzhen City. AutoX said it started in January to allow the public to sign up for robot taxi rides. It wasn’t immediately clear whether there was a cost for the trip.

Baidu’s autonomous vehicle commercial operation permit covers an area of ​​60 square kilometers, including a town called Yizhuang, which is home to many businesses such as JD.com’s headquarters. The region is about half an hour’s drive south of central Beijing.

The Beijing city government has also made Yizhuang a test site for autonomous driving, where companies can test their projects. These include JD’s unmanned delivery vehicles and Baidu’s robotaxi cars.

Baidu’s expansion plans

Last week, Baidu CEO Robin Li said the company plans to expand its Apollo Go Robotaxi service to 65 cities by 2025 and 100 cities by 2030. This is an increase from the current five cities.

The company also announced that its next generation of Robotaxi vehicles would cost half the manufacturing price compared to the previous generation. The models are sold jointly with three electric car manufacturers: the Chinese start-up WM Motor, Aion – a spin-off from the state-owned GAC – and Arcfox from the state-owned BAIC Group.

In June, Baidu and BAIC claimed they could make 1,000 self-driving cars for 480,000 yuan ($ 75,000) each, up from the average of 1 million yuan for an autonomous car.

Wei joined Baidu’s Intelligent Driving Group in May after seven years at Shouqi Limousine & Chauffeur, where he was CEO. The company operates a high-end version of Didi.

He said Baidu’s strategy for building a robotaxi business is to reduce the cost of self-driving technology and target specific user scenarios.

Rather than taking full advantage of lidar technology – which requires expensive sensors to create detailed maps before the Robotaxi can operate – Wei generally spoke of using algorithms to increase the efficient use of the hardware.

Read more about electric vehicles from CNBC Pro

On the consumer front, Wei said Apollo would focus on ways to provide the user with an experience beyond mere means of transportation – like displaying the streets of Beijing 20 years ago on car windows instead of the current street view.

Another strategy is to find ways to use the robotaxi for non-travel functions, such as a medical treatment room or a public library, he said.

While Apollo is only a small part of Baidu, its development is in line with the CEO’s attempts to convince investors that the company’s future lies in artificial intelligence and related areas like autonomous driving.

The company’s fastest third-quarter revenue growth was “non-online marketing revenue,” which rose 76% year over year to 5.2 billion yuan ($ 806 million). Baidu attributed the growth to demand for cloud computing and its other AI businesses.

– CNBC’s Arjun Kharpal contributed to this report.

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