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Elon Musk’s Tesla is always at the top of people’s minds when talking about self-driving cars. But in China, Baidu is steadily emerging as Asia’s leader in the development of autonomous vehicles. As early as 2020, experts estimate Baidu to surpass international Artificial Intelligence giants like Tesla and Google.

The Android of the Auto Industry

Baidu created the Apollo project, an open-source platform designed for autonomous driving technology. Apollo is hailed as the Android of the auto industry as it allows third parties to develop apps. This generates more interest among developers and consumers. Similarly, Baidu wants Apollo to establish a democratic operating system that manufacturers and developers can freely build upon.

Baidu is the brains behind its autonomous vehicles. It entrusts its partner original equipment manufacturers (OEMs) to work on hardware, marketing, branding, and customer management. Vehicles are then assembled without Baidu having to increase its research and development spending.

Collaborative Data Mining

Baidu is currently working with about 100 global partners—automotive parts suppliers, OEMs, chip manufacturers, and other tech companies. This extensive network empowers Baidu to fill in gaps in driver data from road testing and simulations. While Baidu is a frontrunner in high-definition mapping and AI, it tarries behind competitors Tesla and Waymo in driver data.

Within the Apollo platform, Baidu launched Apollo Scape, a vast open-source data set that bested its contemporaries Kitti and CityScapes. It breaks down video images pixel by pixel for granular processing. When annotated and synthesized, these images help self-driving cars discern its surroundings—from traffic lights, road signs, distances, and even weather. These autonomous cars effectively recognize complex road conditions and drive safely and accordingly.

Chinese Advantage

The Chinese government aims to be a global leader in AI by 2020. It eased regulations to accelerate AI and autonomous vehicle commercialization and to allocate more and longer roads for large-scale public-road testing. The Chinese Ministry of Science and Technology has also cited Baidu as the leader in autonomous driving.

Domestic Competition Rising

Major tech players are cropping up in China and entering the self-driving industry. Didi Chuxing, China’s ride-sharing service, acquired Uber China in August 2016 and has also expanded to Mexico, Japan, Brazil, and Taiwan. Consequently, it has its own source for data with over 20 million vehicles on the road. It can also further monetize its self-driving cars through for ride-sharing, rather than directly selling to consumers.

Baidu, the Automotive AI Underdog

Alibaba, Tencent and their tech partner Baidu, China's AI company
Alibaba, Tencent and their tech Baidu

Didi Chuxing has also built a laboratory in Mountain View, California, where it tests self-driving cars on an undisclosed capacity. It is also working with a startup to develop an all-automated taxi service. Baidu, on the other hand, has never tested in US roads.

Other Chinese leaders noted by the Ministry of Science and Technology, Alibaba and Tencent, have only recently entered the industry. In March 2017 Alibaba started working with different AI experts for its lab. Tencent also announced its self-driving tech project in November 2017, and recently obtained permission for testing in Shenzen.

Ultimately, the success of any of these companies relies on harnessing diverse driver data and creating high quality software. If Baidu is able to mobilize all of its verticals, it will easily edge out all its competitors across China.

Baidu’s Bold Continued Expansion

The Company is allotting substantial capital to fund startups to work under the umbrella of the Apollo partnership alliance. The company launched the Apollo Fund in September 2017, which dedicated $1.5B for 100 autonomous driving projects well into 2020. It financed software developer Smarter Eye for $15M to focus on advanced driver assistance systems as one of its many investments.

The company has also noted a significant shift in its focus and expenses. Baidu’s budget for selling, general, and administrative expenses are being divested to research and development. As they ramp up on R&D, there will be a year-on-year decrease in its SG&A expenses.

Baidu is partnering with domestic and international companies for a number of initiatives. It focuses on vehicle testing with various autonomy levels, self-driving vehicles for disabled and challenged seniors, and autonomous tourist buses, among others.

The realm of autonomous driving continually expands as more partnerships and collaborations develop, and the applications of autonomy are outlined for commercial consumption. With a strong support from the Chinese government and its network of collaborators, Baidu is advancing as an Asian trailblazer that is set to make its mark in the global autonomous transportation landscape.

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