There’s an interesting development in the world of Chinese tech firms.
Baidu’s stocks jumped significantly on Tuesday, soaring by 9%. As the day progressed, they remained up around 8.5% by 12:46 PM ET.
Catalyst, a leading player in the high-tech sector in China, is known for its work on autonomous vehicle platforms.
Entering the Global Market
In a recent announcement, Baidu shared that it has teamed up with Uber to enhance the global rollout of self-driving cars. This partnership is set to last several years and aims to roll out thousands of Baidu Apollo GO Autonomous Vehicles (AVs) through Uber’s platforms in various markets beyond the U.S. and mainland China. The main goal, as stated, is to boost the availability of affordable and dependable ride-sharing options.
This collaboration could be a significant turning point for Baidu, given Uber’s position as the leading ride-hailing platform in the world. To put this into perspective, Uber facilitated around 3 billion rides in the first quarter alone, with over 170 million active users. They’ve experienced steady growth in both rides and customers, which is quite impressive.
Baidu’s Apollo Go fleet has already deployed over 1,000 unmanned vehicles globally, earning recognition as a top autonomous ride service provider.
The first deployment of vehicles through this partnership is slated to take place in Asia and the Middle East later this year. According to the press release, once operational, riders who request an Uber may be offered the option of traveling in a fully unmanned Apollo GO vehicle.
Baidu is often called the “Google of China,” with search capabilities being its primary focus. However, over recent years, its growth has somewhat plateaued. Should the collaboration with Uber succeed, it could signal a new chapter for Baidu.
That said, like many companies in China, Baidu faces certain risks. Still, the stock appears reasonably priced considering the myriad opportunities ahead, given that its revenue for the last 12 months is only nine times its current price.
