Is Baidu Looking To Get Ahead In The Autonomous Cars Race?

Reports suggest that Baidu will start testing autonomous cars in the U.S. as a part of its efforts to introduce a commercially viable model in the market by 2018. The company is also advocating better coordination with the U.S. Government for regulatory approvals necessary to bring self-driving cars on the road. This move comes on the back of General Motors’ recent acquisition of Cruise Automation, a software company dedicated to self-driving car technology, so as to accelerate its development of autonomous cars. With Tesla’s first fully autonomous vehicle expected to hit the road by 2018, other automakers such as Ford and Toyota and Baidu’s global competitor Google are likely to launch their self-driving cars by 2020. Baidu is investing in patents and stepping up field tests to get ahead of the competition in the race for autonomous cars, where it will face intense competition from several players. With China expected to be the largest market for self-driving vehicles globally, we believe Baidu is stepping up its efforts to gain the first movers advantage in the region.

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Plans To Launch Self-Driving Shuttles In China By 2018
After testing its autonomous vehicle in a 30 km loop in Beijing in December last year, Baidu now plans to launch its self-driving shuttles in run in a loop in a designated area in China by 2018. This is an ambitious target, given that most companies (including Google) expect their autonomous vehicle to hit the road in 2020. Baidu’s test drive in the U.S. is aimed at better coordination with the U.S. government to ensure that it gets the necessary regulatory approvals for the launch. While Tesla expects its first autonomous vehicle to be ready by 2018, the company believes that it might take another two to three years for regulatory approvals. Google is already looking at speeding up the approval process. The company recently sent a letter to the US Transportation Secretary with a specific framework and details that could expedite the regulatory approval process. Its proposal calls for granting new federal authority to the Department of Transportation that would allow driverless car manufacturers to market their cars if they can demonstrate that the cars passed the federal safety standards. While each state in the U.S. has its own road rules, autonomous vehicle makers are now pushing for a national policy for self-driving vehicles.
Baidu’s focus on artificial intelligence gives in an edge in self-driving cars technology. It partnered with BMW in 2014 to develop autonomous cars and its approach is to assist drivers rather than launch fully autonomous vehicles. The company also has a good understanding of the Chinese market where it is the leading search engine with 80% market share. Its Baidu Maps is extremely popular as well. With China expected to be the dominant market for autonomous vehicles, reportedly accounting for 35% of the 120 million autonomous cars sold in 2030, Baidu has a huge opportunity if it can establish a strong presence in this market. We believe Baidu’s strategy to test drive its autonomous vehicles in the U.S. is to expedite regulatory approvals which could prove to be a major hurdle in the commercial launch of its vehicles. If the company succeeds in launching these vehicles ahead of competition in China, it can capture the first movers advantage and attain a huge competitive edge over other players.