The logo of Baidu Inc. appears at the company headquarters on July 3, 2019 in Beijing, China.
Wan Xiaojun | Visual China Group via Getty Images
GUANGZHOU, China – Chinese internet giant Baidu has partnered strategically with Geely Automotive to build a stand-alone electric vehicle unit, the companies confirmed on 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 automaker Geely will get a minority stake, the man told CNBC.
Shares of Geely listed in Hong Kong rose slightly by 0.45% on Monday, after rising nearly 20% on Friday. Shares of Baidu in the US rose more than 15% at the close of trading on Friday.
Geely will be responsible for the actual construction of the vehicles. Baidu will focus on car software and technology. The search giant has already tested the driverless car software, called Apollo, in public robotaxi tests in Beijing.
Baidu also has its own map 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 billing infrastructure.
Home electric carmakers Nio, Li Auto and Xpeng Motors all reported an increase in deliveries for December. Baidu hopes to get into some of the electric vehicle operations.
“China has become the largest market for electric vehicles in the world (electric vehicles) and we see EU consumers demanding next-generation vehicles to be smarter,” said Robin Li, CEO of Baidu.
The electric car market continues to become more competitive with companies increasing the production and circulation of new vehicles.
On Saturday, Nio released its first sedan called et7. Apple iPhone maker Foxconn has signed an agreement with Chinese electric car maker Byton to help produce the first vehicle.