Chinese tech titan Baidu (ticker: BIDU) received approval Thursday to operate commercial driverless robotaxi services in a specified zone in Beijing, sending the stock higher in Hong Kong trading.
(7203.Japan)-backed self-driving start-up Pony.ai Inc. was also granted a license, in the first ever regulatory approvals for paid driverless taxis by Chinese authorities, after testing periods.
Baidu’s Apollo Go service, known as Luobo Kuaipao in China, has been given authorization to pick up and drop off paying passengers in a 60 square kilometers area in the Beijing Economic and Technological Development Zone. The company’s fleet of 67 vehicles will cover more than 600 pickup and drop-off points in commercial and residential areas, Baidu said.
Baidu wants to launch its driverless taxi service in 100 cities by the end of the decade and Thursday’s approval will be seen as a key step in the process. It was certainly seen that way by investors as the Hong Kong-listed stock (9888: Hong Kong) climbed 4.5%.
When the U.S. market reopens Friday after the Thanksgiving holiday, Baidu’s U.S.-listed stock may be one to watch. The stock has fallen 30% year-to-date, largely due to China’s wide-ranging crackdown, which has particularly affected tech stocks.
It fell 10% over the course of last week, during which the company reported third quarter earnings. Those earnings may have beaten expectations, for both profit and revenue, but Baidu warned ad sales would be hit by the regulatory crackdown in the coming quarters.