Driverless car technology and the rise of the web-connected vehicle is a global phenomenon despite the seeming domination of U.S.-based companies like Google with its high-profile work in self-driving car tech. The connected car industry is getting a huge boost this week in China as Baidu — the country’s largest search engine — announced on Monday that it is partnering with Germany’s Daimler AG to bring web connectivity to Mercedes-Benz vehicles in China. The cars will develop to include software that connects users’ smartphones and other devices to their cars’ dashboards which will provide access to the internet and services such as music.
This announcement comes a week after Volkswagen made a similar deal with Baidu; the company’s flagship luxury brand Audi said last week that it will jointly develop navigation map data, positioning algorithms and point-of-interest functions with Baidu, according to Reuters. Germany’s auto manufacturers are clearly seeing the business opportunity that has been created from the collaboration of luxury vehicle brands with the growing dominance of the mobile market. And China’s smartphone market — the largest in the world — presents huge opportunities for the development of the connected car market.
These partnerships are additional examples of Baidu’s efforts to become a large player in industries outside its search business. For a couple of years now Baidu has been making strategic investments into mobile operations, having partnered with giants like Intel so as to not miss the mobile boat. And the company’s work in mobile is having tangible effects on its bottom line; Baidu posted its slowest revenue growth rate in almost seven years in its Q1 of 2015 reported in late April. That slowdown was a result of its bid for mobile in China, pushing research and development to ensure its foothold in the world’s largest smartphone market.
So these next steps for Baidu with German car manufacturers seem like smart ones; not only will the search company be ingraining itself into the burgeoning connected-car business, but it will necessarily be a bigger part of the mobile market as mobile device-to-dashboard connection is at the core of these projects. Furthering its strength in the mobile/auto space, Baidu is reportedly teaming with U.S.-based Uber — the now internationally notorious taxi service — in a bid for Nokia’s mapping business. Earlier this month, Bloomberg reported that Uber, Baidu, and Apax Partners could all jointly bid for Nokia’s HERE technology — a unit that Audi, BMW, and Daimler all also have an interest in as navigation tech will be a key component of the future self-driving car. Clearly, the gears are turning for international investment in China’s future car markets, and Baidu wants to be in the driver’s seat.