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Cruise woes to hit Baidu, Xpeng
Research firm warns that big Chinese AD backers could also face blowback from US market leader’s San Francisco issues
China’s Baidu and Xpeng will be negatively impacted by the controversy over US autonomous driving (AD) firm Cruise that has seen its licence to operate in California revoked and its CEO abruptly resign, in the view of Hong Kong-based research house Blue Lotus.
“In general, we remain pessimistic on the robotaxi self-driving sector, despite the segment being far ahead of the autonomous freight network segment,” Blue Lotus says.
“With US testing of robotaxi technology far ahead of China, this setback suggests that Chinese robotaxi operators are also at risk” if they push ahead with aggressive strategies, it warns. And it fears Cruise’s US woes are likely to put additional regulatory roadblocks in the way of “achieving any meaningful breakthroughs” in China.
Xpeng’s $170mn acquisition of the Mona EV business from Chinese ride-hailing heavyweight Didi “faces new limitations for an easy pathway for service launch, specifically due to the limited potential for capacity to test new markets”, Blue Lotus forecasts.
The Chinese OEM is aiming to roll out a new EV in the RMB150,000 ($20,800) market with, at the very least, level 2+ advanced driver-assistance systems (ADAS) capabilities — if not full level 3 or above AD — as its first Mona product next year.
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Chinese tech and AI firm Baidu’s AD solution ranked first in China during the second half of last year, with a market share of 35.9pc according to data from Chinese market intelligence firm IDS, Blue Lotus says. But whereas it has a Sell recommendation on Xpeng, it retains an overall Buy for Baidu despite possible AD problems for the firm.