Li Shufu, chairman of Zhejiang Geely Holding Group Co., left, and Robin Li, co-founder and chief … [+]
© 2019 Bloomberg Finance LP
Baidu, one of China’s largest Internet businesses, on Monday confirmed a report last week that it plans to produce electric vehicles in a partnership with Zhejiang Geely Holding Group.
Baidu will provide intelligent driving capabilities to power the passenger vehicles for the new venture, and Geely will provide vehicle design and manufacturing. The agreement brings together two of China’s richest billionaires: Geely Chairman Li Shufu and Baidu CEO Robin Li.
“At Baidu, we have long believed in the future of intelligent driving and have over the past decade invested heavily in AI to build a portfolio of world-class self-driving services,” Li said in a statement. “China has become the world’s largest market for EVs, and we are seeing EV consumers demanding next generation vehicles to be more intelligent.”
“As a top Chinese automaker with global reach, Geely has the unique experience and resources to design, produce and market energy-efficient, reliable and safe automobiles in large scale,” Li said. “We believe that by combining Baidu’s expertise in smart transportation, connected vehicles and autonomous driving with Geely’s expertise as a leading automobile and EV manufacturer, the new partnership will pave the way for future passenger vehicles.”
A new company will operate as an independent subsidiary of Baidu and oversee the entire industrial chain, from vehicle design to research and development, as well as manufacturing, sales, and service, Baidu said.
Nasdaq-traded shares in China Internet heavyweight Baidu soared by 15.6% to a nearly two and a half year high of $240.25 on Friday following a Reuters report it would team up with China automaker Geely. Baidu is best known for its search engine but is also a China leader in autonomous driving systems.
Shares in Geely, one of China’s largest home-grown passenger car brands, soared by 19.6% in Hong Kong on Friday on the report to close at a record high of HK$33.25. Geely’s Li Shufu also chairs Volvo Car Group.
Baidu climbed on a day in which shares in gravity-defining Telsa rose by 7.8% to an all-time high of $880.02.
China is the world’s largest auto market, its economy has recovered from the worst of COVD-19 earlier this year, and shares in China automakers targeting the small-but-growing EV market have soared this year, among them U.S.-listed Li Auto, XPeng and Nio. Nio climbed by 8.6% on Friday to a record $58.92 ahead of a product announcement on Saturday. Nio’s gain valued the Shanghai-headquartered company at $92 billion; by way of comparison, GM was worth $61 billion and Ford $36 billion at the end of stock trading.
Not to be left out of the stock and wealth-creation frenzy, shares in Warren Buffet-backed BYD, one of China’s earliest EV makers, rose to 2% in Hong Kong on Friday to a record HK$240.20. That gave BYD’s chairman Wang Chuanfu a fortune worth nearly $19 billion today. Nio’s chairman William Li is worth $8 billion, XPeng’s chairman He Xiaopeng nearly $9 billion, and Li Auto’s chairman Li Xiang $6 billion. Geely’s Li is China’s richest auto billionaire with a fortune worth nearly $24 billion.
Robin Li’s fortune, combined with his wife and Baidu executive Melissa Ma, was worth a combined $17 billion on the Forbes Real-Time Billionaires List on Friday. China is home to the world’s largest number of billionaires after the United States.