Zhang Yaqin, president of Baidu Inc, introduces Baidu's Apollo Autonomous Driving Vehicle and Platform during the World Leading Internet Scientific and Technological Achievements of the 5th World Internet Conference, in Wuzhen town, East China's Zhejiang Province, on November 7, 2018. Photo: IC

Baidu Inc is shifting part of its research and development (R&D) work for the autonomous-driving project Apollo from the US to China, which analysts said was a "rational" way for the company to become better-integrated in the nation's fast-growing intelligent transportation sector supported by 5G.

Baidu confirmed the shift to the Global Times on Tuesday. It said that the move will help Apollo fit into the expansion of domestic sectors such as intelligent transportation as well as accelerate its application and commercialization. 

The transfer will allow Apollo's products and commercial growth to further connect with domestic partners and benefit from China's industrialization and scale advantages, the company said.

The remaining work in the US unit will focus more on the R&D of cutting-edge and core technology and promote the construction of a global ecosystem for Apollo, according to Baidu. 

Feng Shiming, a veteran car industry analyst based in Shanghai, said Baidu's move was probably driven by technology and market factors. 

Given the US government pressure on China's high-technology sector, US technology companies have increasingly taken precautions against Chinese companies, and the flow of talent and technological learning in the US may not have met Baidu's expectations, Feng told the Global Times on Tuesday.

Feng called it a "rational" choice [for Baidu] to abandon a mature market and seek gains in a more promising emerging region, as China's 5G technology and chip sector are developing quickly and the country has become one of the standard setters of autonomous-driving technology.

Also, road conditions and user habits in China are different from those in the US, and tests in the domestic market are more targeted, Feng said, noting that as Baidu's customers and partners are mostly in China, the transfer will lower operating costs.

Baidu announced it set up an R&D unit for autonomous vehicles in Silicon Valley in April 2016. One year later, it unveiled the Apollo project, opening up its autonomous-driving platform, which has gained increased exposure in the Chinese market during recent years.

The government of Cangzhou, North China's Hebei Province, issued 30 test licenses for smart connected cars to Baidu on Saturday, and pilot autonomous taxi trips will start there later this month, media reports said.

On September 22, Baidu and other two Chinese companies won the country's first commercial licenses from the traffic authorities in Wuhan, Central China's Hubei Province. These licenses, unlike those for road tests, will enable intelligent-connected cars to carry passengers publicly.

Industry insiders said that Chinese governments at various levels have attached great importance to the autonomous-driving sector. Their frequent issue of test licenses and road test data, as well as improvement of infrastructure, will allow the Chinese industry to pursue faster growth than other countries. 

Transport authorities have awarded road test licenses for autonomous driving in 16 cities such as Beijing, North China's Tianjin Municipality and Changsha, Central China's Hunan Province, since March 2018, media reports said. 

Chinese and US top players in the driverless car industry lead the growth of the sector across the globe but the development path for companies from both countries has diverged, insiders said.

The US autonomous-driving companies are pioneers in the sector as they first developed the technology and had advantages such as ample capital, Liu Dingding, a Beijing-based industry analyst, told the Global Times on Tuesday.

"China's application and policy support for the sector will greatly advance its development," Liu noted.

More tests are needed, and it will take more than a decade to realize large-scale autonomous-driving trips in the Chinese market, according to Liu.