Shares of Geely Automobile Holdings Ltd. (OTC: GELYF; HKEX: 00175) jumped 16% in New York and 20% in Hong Kong on potential cooperation with Baidu (Nasdaq: BIDU) to make electric vehicles for China.
Under the deal, Baidu will provide in-vehicle software and Geely will offer engineering technology, with the new car to be produced at Geely's factories. The two will also work together on Geely's new EV platform.
Last month, Baidu said it was considering making its own electric car. The company has held preliminary talks with Geely, Guangzhou Automobile Group (OTC: GNZUF; HKEX: 02238) and China FAW Group Corp Ltd.’s Hongqi about the possibility, and it was looking to form a majority-owned joint venture.
Now, Baidu has also signed a deal with GAC to jointly develop related technologies in the digital marketing of intelligent driving and intelligent vehicle alliance, and provide comprehensive systematic and reliable solutions in the fields of automatic driving and mobile travel intelligent network connection and intelligent transportation.
Baidu aims to monetize its driverless technology Apollo, into which the company has pumped billions of dollars since 2015. Baidu's strategy, it said, is to make Apollo an open platform similar to Android, with carmakers using it to develop smart cars.
The stock in Baidu soared 14% Friday afternoon in New York, at $236.54 per American depositary share.