As robotics companies stumble in the US, China’s fleet expands

On the same day that General Motors announced that it would stop funding its robotics company Cruise, one of China’s leading autonomous vehicles made a separate announcement.

Pony.ai said it will expand its robotics fleet from about 250 vehicles to at least 1,000 vehicles by 2025, thanks to a partnership with GAC Aion, a division of one of China’s largest auto industries. With a large fleet, the company says it plans to expand its service areas in the so-called first-tier cities of Beijing, Guangzhou, Shanghai, and Shenzhen. The current horse fleet averages 15 rides per vehicle per day, which means more than 26,000 trips each week.

It was another example of how access to cheap, plentiful electric cars and a lax regulatory environment and other government-fueled incentives are fueling China’s aggressive approach to autonomous vehicles. Baidu, another major Chinese AV company, recently explained its efforts to reduce the cost of each car to about $30,000. Baidu also has a joint venture with automaker Geely to develop self-driving cars.

In the US, ties between car manufacturers and driverless car operators are tenuous. In addition to GM’s decision to pull out of Cruise, Ford is shutting down its Argo AI robot project that it had previously sponsored with Volkswagen. Both Ford and GM say they plan to refocus their efforts on driver assistance technology for self-driving cars.

The United States is wary of China’s growing dominance in the autonomous vehicle sector. Earlier this year, the Biden administration proposed new rules to ban the “sale or importation” of connected car software from China, saying vehicles with hardware and software from the country pose a “serious” threat to US national security. This follows the administration’s previous move to impose new tariffs on imports of Chinese products, including a 100 percent tax on EVs and new increases on batteries and precious minerals. And President-elect Donald Trump, whose Cabinet is full of China hawks, has promised even tougher tariffs.

These protectionist trade policies may slow the development of self-driving cars in the US. Waymo, a leading robotics company, has said it will use the Chinese EV as its next-generation vehicle. The car made by Zeekr was supposed to be a low-cost option for the company, which has racked up billions of dollars in costs over the years.

Robotaxis can move without access to cheaply made EVs. Indeed, the public markets have not been receptive to Pony.ai and other Chinese companies, despite their aggressive expansion plans. The company’s initial public offering on Nasdaq was worth $5.25 billion, or about 40 percent less than the $8.5 billion it was worth two years ago, according to the report. Financial Times.

No AV operator in the world is profitable yet. The fleet is still very small, companies are very conscious of rapid growth, and the technology is still more expensive than the small revenue it brings.

Pony.ai and others hope that the Chinese government will soon allow their cars to extend into the suburbs. Meanwhile, Trump’s transition team is in the process of creating a federal framework for self-driving cars, which would allow for the widespread deployment of vehicles without traditional controls, such as steering wheels and pedals.

But the threat that China will overtake the US in the development of robotaxi did not encourage Congress to break the logjam that has stalled AV legislation in Congress for more than six years. Disagreements range from increasing the number of AVs on the road to preventing states from setting their own performance standards for AVs to liability issues.

Cities may oppose companies trying to roll out self-driving cars. Officials in San Francisco, for example, have raised a number of complaints, including blocked buses and emergency vehicles, and local residents have joined protests over new laws allowing robotaxis to roam freely.

That concern is likely to remain a strong point. Meanwhile, China has already surpassed the US in robotaxi installations. The question is how much forward they can get.