Baidu Secures Hong Kong License for Autonomous Vehicle Testing

On Saturday, Baidu, Inc BIDU received a license to test autonomous vehicles in Hong Kong. This marks the government’s first pilot license since new legislation was introduced in March 2024.

A Step Forward for Autonomous Technology

The license is effective from December 9, 2024, until December 8, 2029. Initially, it allows only one self-driving car to operate on designated road segments. This move represents Baidu’s efforts to expand its autonomous vehicle technology beyond China, as reported by Reuters.

Trial Expansion in North Lantau

Baidu’s Apollo International unit is authorized for a trial with 10 autonomous vehicles in the North Lantau area, according to Hong Kong’s Transport Department, as noted by Bloomberg. An Apollo Go spokesperson mentioned that the aim is to expand AI and autonomous driving technology into additional countries and regions.

Ambitions for the Robotaxi Market

Launched in May, Baidu’s autonomous ride-hailing service, Apollo Go, introduced an affordable robotaxi model with a goal to break even by 2025. Reports indicate plans to extend the robotaxi service into Hong Kong, Singapore, and the Middle East.

Fiscal Performance Amid Challenges

In its fiscal third quarter, Baidu reported a revenue decline of 3% to $4.78 billion, though this figure exceeded the analyst expectation of $4.69 billion. Additionally, the company’s adjusted earnings per ADS stood at $2.37, surpassing the consensus estimate of $2.35.

Competition in the Robotaxi Space

Meanwhile, Tesla Inc TSLA held its robotaxi event in October 2024. In a related development, Chinese robotaxi developer WeRide Inc WRD announced a new partnership with Uber to integrate its vehicles into the ride-hailing service in Abu Dhabi.

Stock Overview

Year-to-date, Baidu’s stock has declined by over 26%, impacted by a sluggish economy and U.S. semiconductor sanctions on China. Domestic fiscal stimulus measures have not met market expectations.

Investment Opportunities

Investors interested in Baidu can consider gain exposure through the Managed Portfolio Series Tremblant Global ETF TOGA and the Roundhill Ball Metaverse ETF METV.

Price Action: BIDU stock rose by 0.66% to $85.61 in premarket trading as of the latest update on Monday.

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Photo via Wikimedia Commons