Dec 16, 2016 07:32 PM

Tencent Revs Up Driverless Car Program with New Tie-Up

(Beijing) —Tencent has accelerated its move into China's self-driving car race by making a deal with the country's first industry park for connected vehicles, as the internet giant plays catch-up with rivals Baidu and Alibaba.

Under their framework deal signed on Thursday, Tencent Holdings Ltd. and Shanghai International Automobile City agreed to collaborate on autonomous driving, high-definition mapping and setting industry standards for smart cars.

Tencent's lab will be in an innovation zone within the sprawling 100-square-km park. Baidu Inc.'s autonomous-vehicle division similarly relocated to the zone in May.

Over the years, Tencent has taken a slow and somewhat unfocused approach in the driverless-vehicle race. It has made scattered investments in mapping and navigation technology, and joined Taiwan's Foxconn to back smart-car newcomer Future Mobility, which intends to launch a self-driving car by 2020. But Tencent founded its own Autonomous Driving Labs only in the second half of this year.

China's tech giants have been spending heavily on the autonomous-driving sector, responding to Beijing's call to develop the area. The drive falls under the larger "Made in China 2025" strategy, a nationwide initiative to upgrade the nation's production lines with information technology.

Beijing is famous for mounting such campaigns to target sectors it wants to develop, the result of China's legacy as a planned economy. But such campaigns also often result in waste and development of inferior products, as companies rush to cash in on government incentives despite not having proper experience and background.

Internet search giant Baidu's driverless-vehicle business dates back to 2014, when it began working with domestic automakers Chery Automobile Co. Ltd. and BYD Auto Co. Ltd. to develop an autonomous car. Alibaba Group Holding Ltd. has showcased a smart vehicle made with state-owned SAIC Motor Corp. Ltd. that promises driverless functions in the near future.

One of the best-known ambitions has come from online video company LeEco, which is focusing on both new-energy and driverless technologies through a tie-up with U.S. startup Faraday Future. But that costly drive, including a $1 billion factory in the U.S. state of Nevada, has also contributed to a LeEco cash crunch, following two years of breakneck expansion by the company into a number of new areas.

Contact reporter April Ma (

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