Key Takeaways
Baidu shares rose on Wednesday after optimistic reports about the Chinese tech company’s robotaxi business. Dow Jones News and Bloomberg pointed to an analyst note that said Baidu’s Apollo Go robotaxi business is likely to break even this year in Wuhan. The impending launch of Tesla’s robotaxi is also raising hopes.
Baidu (BIDU) American Depositary Receipts (ADRs) rose in intraday trading on Wednesday after reports that the Chinese internet search engine’s robotaxi business, Apollo Go, is getting off the ground in China.
Dow Jones News and Bloomberg both reported that they expect Apollo Go to break even in Wuhan this year, citing a note from Guotai Junan International analyst Li Muhua, who added that autonomous driving will be the key deal over the next three months, driven by the launch of Tesla’s (TSLA) robotaxi in August.
Apollo Go’s operating costs are expected to drop significantly
According to Bloomberg, Li noted that Apollo Go has begun manned tests in 11 Chinese cities and is conducting driverless tests in Wuhan, Beijing, Chongqing, Shenzhen and Shanghai. The analyst added that operational costs will be significantly lower.
Dow Jones News reported that enthusiasm has been further fuelled by draft rules for self-driving cars drawn up by regulators in Beijing being published on local media sites.
Baidu’s ADRs rose 2.7% to $97.96 as of 11:34 a.m. ET on Wednesday but are still down more than 17% this year. Tesla shares, which have risen for 10 straight days, were little changed.
