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Baidu’s supercheap robotaxis should scare the hell out of the US - The Verge
<!DOCTYPE html><html lang="en"><head><meta charSet="utf-8"/><meta name="twitter:card" content="summary_large_image"/><meta name="twitter:site" content="@verge"/><meta property="fb:app_id" content="549923288395304"/><meta property="og:site_name" content="The Verge"/><meta name="viewport" content="width=device-width, initial-scale=1, shrink-to-fit=no"/><meta name="apple-mobile-web-app-title" content="Verge"/><meta name="google-site-verification" content="IucFf_TKtbFFH8_YeFyEteQIwYPdANM1R46_U9DpAr4"/><link rel="alternate" type="application/rss+xml" title="The Verge" href="/rss/index.xml"/><title>Baidu’s supercheap robotaxis should scare the hell out of the US - The Verge</title><meta name="robots" content="index,follow,max-image-preview:large"/><meta name="description" content="China’s Baidu is launching its sixth-generation robotaxi, which it claims costs less than $30,000 to manufacture. That should make Waymo and other US operators nervous. 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"/><meta property="og:url" content="https://www.theverge.com/2024/11/22/24303299/baidu-apollo-go-rt6-robotaxi-unit-economics-waymo"/><meta property="og:type" content="article"/><meta property="article:published_time" content="2024-11-22T18:01:36.743Z"/><meta property="article:modified_time" content="2024-11-22T18:01:36.743Z"/><meta property="og:image" content="https://cdn.vox-cdn.com/thumbor/Jo4ksCulvnfMs4eVK4S42FCiDGw=/0x0:4500x3000/1200x628/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg"/><meta property="og:image:alt" content="Baidu Apollo Go robotaxi"/><meta property="og:image:type" content="image/jpeg"/><meta property="og:image:width" content="1200"/><meta property="og:image:height" content="628"/><link rel="canonical" href="https://www.theverge.com/2024/11/22/24303299/baidu-apollo-go-rt6-robotaxi-unit-economics-waymo"/><meta property="author" content="Andrew J. Hawkins"/><meta name="parsely-type" content="post"/><meta name="parsely-title" content="Baidu’s supercheap robotaxis should scare the hell out of the US"/><meta name="parsely-link" content="https://www.theverge.com/2024/11/22/24303299/baidu-apollo-go-rt6-robotaxi-unit-economics-waymo"/><meta name="parsely-image-url" content="https://cdn.vox-cdn.com/thumbor/Jo4ksCulvnfMs4eVK4S42FCiDGw=/0x0:4500x3000/1200x628/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg"/><meta name="parsely-pub-date" content="2024-11-22T18:01:36.743Z"/><meta name="parsely-section" content="front-page"/><meta name="parsely-tags" content="verge,front-page,autonomous-cars,transportation,news,tech,google-waymo,earnings,featured-story"/><meta name="parsely-author" content="Andrew J. Hawkins"/><script type="application/ld+json">{"@context":"http://schema.org/","@type":"NewsArticle","headline":"Baidu’s supercheap robotaxis should scare the hell out of the US","description":"China’s Baidu is launching its sixth-generation robotaxi, which it claims costs less than $30,000 to manufacture. That should make Waymo and other US operators nervous.","datePublished":"2024-11-22T18:01:36.743Z","dateModified":"2024-11-22T18:01:36.743Z","thumbnailUrl":"https://cdn.vox-cdn.com/thumbor/W6yWtsib7dZip4AyzV1l-VCSZsU=/0x0:4500x3000/1400x788/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","author":[{"@type":"Person","name":"Andrew J. Hawkins","url":"https://www.theverge.com/authors/andrew-j-hawkins"}],"publisher":{"@type":"Organization","name":"The Verge","logo":{"@type":"ImageObject","url":"https://cdn.vox-cdn.com/uploads/chorus_asset/file/24015294/verge_duet_google_news.png","width":250,"height":50}},"image":[{"@type":"ImageObject","url":"https://cdn.vox-cdn.com/thumbor/W6yWtsib7dZip4AyzV1l-VCSZsU=/0x0:4500x3000/1400x788/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","width":1400,"height":788},{"@type":"ImageObject","url":"https://cdn.vox-cdn.com/thumbor/-N4IukZcsbxvobpS4ylJRa4I770=/0x0:4500x3000/1400x1050/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","width":1400,"height":1050},{"@type":"ImageObject","url":"https://cdn.vox-cdn.com/thumbor/tQOo28g3j9NBqDm0s6oaTdscjX0=/0x0:4500x3000/1400x1400/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","width":1400,"height":1400}],"url":"https://www.theverge.com/2024/11/22/24303299/baidu-apollo-go-rt6-robotaxi-unit-economics-waymo","articleBody":"Baidu’s robotaxi division, Apollo Go, just rolled out its latest robotaxi across multiple cities in China, and if stakeholders in the US aren’t nervous yet, they should be.\n\nThe RT6 is the sixth generation of Apollo Go’s driverless vehicle, which made its official debut in May 2024. It’s a purpose-built, Level 4 autonomous vehicle, meaning it’s built without the need for a human driver. And here’s the thing that should make US competitors nervous: adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000,” Baidu CEO Robin Li said in an earnings call.\n\n“All the strengths just mentioned above are driving us forward, paving the way to validate our business model,” Li added. \n\n\"Adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000”\"\n\nWith Alphabet’s Waymo operating in multiple cities in the US and Baidu deploying hundreds of vehicles in China, the world is now getting its first taste of an autonomous future. These vehicles are geofenced, meaning they can only operate in a select geographic area. And sure, they occasionally get confused or block traffic. But they’re real, and they’re growing in number. \n\nBut it’s Baidu’s achievements in cost-effectiveness that should have Waymo and other robotaxi operators a little uncomfortable. Because while the technology is growing more mature, the economics of a robotaxi business are still very much unproven. \n\nWe still don’t know the net effect of Baidu’s cost improvements. But bringing down the upfront cost of each individual vehicle to below $30,000 will go a long way toward improving the company’s unit economics, in which each vehicle brings in more money than it costs. There are still a lot of outstanding costs to consider, such as hardware depreciation and fleet maintenance, but from what Baidu is signaling, things are on the right track. \n\nFrom the looks of it, the company is passing those savings along to its customers. Base fares start as low as 4 yuan (around 55 cents), compared with 18 yuan (around $2.48) for a taxi driven by a human, according to state media outlet Global Times. Apollo Go said it has provided 988,000 rides across all of China in Q3 2024 — a year-over-year growth of 20 percent. And cumulative public rides reached 8 million in October.\n\n[Image: https://cdn.vox-cdn.com/thumbor/5jkeMbZe5GZ-R2V0EQgf7XmAddU=/0x0:5000x3750/5000x3750/filters:focal(2500x1875:2501x1876)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749767/2170970455.jpg]\n\nWith Waymo, we just don’t know. The company has spoken publicly about its efforts to reduce the costs of each vehicle by using fewer sensors. But its latest vehicle, Geely’s Zeekr, is likely going to be waylaid by tariffs on imports from China. A recent analysis from JMP found the company’s business in San Francisco to be profitable, while also estimating capital expenditures for the vehicle and sensor suite to be north of $150,000 per unit. \n\nLowering costs is going to be increasingly important for robotaxi companies as they look to expand to new cities. Alphabet doesn’t break out Waymo’s costs in its earnings report, but its “Other Bets” unit, which includes the robotaxi company, brought in $388 million in revenue in the third quarter of 2024, up from $297 million a year ago. But the unit’s losses held flat at $1.12 billion compared to $1.94 billion in the year-earlier period. Alphabet recently led a $5.6 billion funding round for Waymo to help it cover costs as it eyes its next phase of growth. \n\nWe know the technology works, but for driverless cars to have a real chance, we need to see evidence that it can make money, too. \n"}</script><link rel="preload" as="image" imageSrcSet="https://duet-cdn.vox-cdn.com/thumbor/0x0:4500x3000/16x11/filters:focal(2250x1500:2251x1501):format(webp)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg 16w, https://duet-cdn.vox-cdn.com/thumbor/0x0:4500x3000/32x21/filters:focal(2250x1500:2251x1501):format(webp)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg 32w, https://duet-cdn.vox-cdn.com/thumbor/0x0:4500x3000/48x32/filters:focal(2250x1500:2251x1501):format(webp)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg 48w, 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text-blurple"><a class="hover:shadow-underline-inherit" href="/autonomous-cars">Autonomous Cars</a><span class="px-6">/</span></li><li class="inline font-polysans-mono text-12 font-medium uppercase tracking-12 text-blurple"><a class="hover:shadow-underline-inherit" href="/transportation">Transpo</a><span class="px-6">/</span></li><li class="inline font-polysans-mono text-12 font-medium uppercase tracking-12 text-blurple"><a class="hover:shadow-underline-inherit" href="/tech">Tech</a></li></ul><h1 class="mb-28 hidden max-w-[900px] font-polysans text-45 font-bold leading-100 selection:bg-franklin-20 lg:block">Baidu’s supercheap robotaxis should scare the hell out of the US</h1><span class="sticky-nav-trigger"></span><div class="flex flex-col lg:flex-row-reverse lg:justify-end"><div class="flex-col lg:flex lg:ml-40"><div class="mb-24 grow"><h1 class="inline font-polysans text-22 font-bold leading-110 md:text-33 lg:hidden">Baidu’s supercheap robotaxis should scare the hell out of the US</h1><span class="font-polysans text-22 font-light leading-110 md:text-30 lg:block"><span class="text-blurple"> / </span><h2 class="inline selection:bg-franklin-20">Apollo Go’s sixth-generation driverless car is here.</h2></span></div><div><div class="mb-16 w-[200px] border-t border-gray-bd lg:hidden"></div><div class="mb-2 text-blurple [&>p>span:first-child]:text-gray-13 [&_.duet--article-byline-and]:text-gray-13"><p class="duet--article--article-byline max-w-[550px] font-polysans text-12 leading-120"><span>By</span> <span><span class="duet--article-byline-and"></span> <span class="font-medium"><a class="hover:shadow-underline-inherit" href="/authors/andrew-j-hawkins">Andrew J. Hawkins</a></span><span class="text-gray-13">, <span class="duet--article--dangerously-set-cms-markup">transportation editor with 10+ years of experience who covers EVs, public transportation, and aviation. His work has appeared in The New York Daily News and City & State.</span></span></span></p></div><div class="duet--article--date-and-comments mb-20 inline-block font-polysans text-12 text-gray-5a"><time dateTime="2024-11-22T18:01:36.743Z" class="duet--article--timestamp font-polysans text-12"> <!-- -->Nov 22, 2024, 6:01 PM UTC</time></div><div class="mb-24 flex lg:mb-0 lg:mb-0"><div class="flex"><div><h2 class="sr-only">Share this story</h2><ul class="duet--article--share-buttons flex leading-[0]"><li class="mr-8"><div class="relative flex items-center"><button aria-label="Copy link" class="rounded-full bg-transparent transition shadow-border-gray-d3 hover:bg-blurple hover:shadow-border-blurple"><svg width="30" height="30" class="transition fill-blurple hover:fill-white" viewBox="0 0 30 30" xmlns="http://www.w3.org/2000/svg"><path d="M13.7876 20.18C12.6943 21.2733 10.9133 21.2733 9.81998 20.18C8.72669 19.0867 8.72666 17.3056 9.81998 16.2123L12.0243 14.0081C13.1176 12.9147 14.8986 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style="position:absolute;top:0;left:0;bottom:0;right:0;box-sizing:border-box;padding:0;border:none;margin:auto;display:block;width:0;height:0;min-width:100%;max-width:100%;min-height:100%;max-height:100%;object-fit:cover"/></span><div class="duet--media--caption pt-6 font-polysans-mono text-12 font-light leading-130 tracking-1"> <cite class="duet--article--dangerously-set-cms-markup inline not-italic text-gray-63 dark:text-gray-bd [&>a:hover]:text-gray-63 [&>a:hover]:shadow-underline-black dark:[&>a:hover]:text-gray-bd dark:[&>a:hover]:shadow-underline-gray [&>a]:shadow-underline-gray-63 dark:[&>a]:text-gray-bd dark:[&>a]:shadow-underline-gray">Image: Getty</cite></div></figure></div></div></div></div><div class="relative md:mx-auto md:flex md:max-w-container-md lg:max-w-none"><div class="duet--article--article-body-component-container clearfix sm:ml-auto md:ml-100 md:max-w-article-body lg:mx-100"><div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">Baidu’s robotaxi division, <a href="/2021/1/27/22252944/baidu-driverless-cars-test-permit-california-dmv">Apollo Go</a>, just rolled out its latest robotaxi across multiple cities in China, and if stakeholders in the US aren’t nervous yet, they should be.</p></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">The RT6 is the sixth generation of Apollo Go’s driverless vehicle, which made its official debut in May 2024. It’s a purpose-built, Level 4 autonomous vehicle, meaning it’s built without the need for a human driver. And here’s the thing that should make US competitors nervous: adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000,” Baidu CEO Robin Li said in <a href="https://seekingalpha.com/article/4739368-baidu-inc-bidu-q3-2024-earnings-call-transcript">an earnings call</a>.</p></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">“All the strengths just mentioned above are driving us forward, paving the way to validate our business model,” Li added. </p></div><div class="duet--article--article-body-component clear-both block md:float-left md:mr-30 md:w-[320px] lg:-ml-100"><div class="duet--article--article-pullquote mb-20"><div class="mb-10 h-[22px] w-[65px] bg-franklin"></div><p class="duet--article--dangerously-set-cms-markup relative bg-repeating-lines-dark bg-[length:1px_1.2em] pb-8 font-polysans text-28 font-medium leading-120 tracking-1 selection:bg-franklin-20 dark:bg-repeating-lines-light dark:text-white dark:selection:bg-blurple">Adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000”</p></div></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">With Alphabet’s Waymo operating in multiple cities in the US and Baidu deploying hundreds of vehicles in China, the world is now getting its first taste of an autonomous future. These vehicles are geofenced, meaning they can only operate in a select geographic area. And sure, they occasionally get confused or block traffic. But they’re real, and they’re growing in number. </p></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">But it’s Baidu’s achievements in cost-effectiveness that should have Waymo and other robotaxi operators a little uncomfortable. Because while the technology is growing more mature, the economics of a robotaxi business are still very much unproven. </p></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">We still don’t know the net effect of Baidu’s cost improvements. But bringing down the upfront cost of each individual vehicle to below $30,000 will go a long way toward improving the company’s unit economics, in which each vehicle brings in more money than it costs. There are still a lot of outstanding costs to consider, such as hardware depreciation and fleet maintenance, but from what Baidu is signaling, things are on the right track. </p></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">From the looks of it, the company is passing those savings along to its customers. Base fares start as low as 4 yuan (around 55 cents), compared with 18 yuan (around $2.48) for a taxi driven by a human, according to <a href="https://www.globaltimes.cn/page/202407/1315784.shtml">state media outlet <em>Global Times</em></a>. Apollo Go said it has provided 988,000 rides across all of China in Q3 2024 — a year-over-year growth of 20 percent. And cumulative public rides reached 8 million in October.</p></div><div class="duet--article--article-body-component clear-both block"><div class="my-9"><div class="transition-all duration-300 ease-in-out"><div class="fixed inset-0 h-[110vh] w-full bg-white transition-all duration-300 ease-in-out z-[-1] cursor-default opacity-0" role="button" aria-label="Close" tabindex="0"></div><div role="button" aria-label="Zoom" tabindex="0" class="visible z-30 w-full origin-center transition-all duration-300 ease-in-out cursor-zoom-in"><figure class="transition-all duration-300 ease-in-out lg:mx-0"><div><div class="duet--media--content-warning relative" style="padding-top:75%"><span style="box-sizing:border-box;display:block;overflow:hidden;width:initial;height:initial;background:none;opacity:1;border:0;margin:0;padding:0;position:absolute;top:0;left:0;bottom:0;right:0"><img alt="Waymo Self-driving car" src="data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7" 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[&>a:hover]:text-gray-63 [&>a:hover]:shadow-underline-black dark:[&>a:hover]:text-gray-bd dark:[&>a:hover]:shadow-underline-gray [&>a]:shadow-underline-gray-63 dark:[&>a]:text-gray-bd dark:[&>a]:shadow-underline-gray">Photo by Smith Collection / Gado / Getty Images</cite></div></div></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">With Waymo, we just don’t know. The company has spoken publicly about its efforts to reduce the costs of each vehicle by <a href="/2024/8/19/24223655/waymos-new-robotaxi-will-feature-fewer-sensors-to-help-lower-costs">using fewer sensors</a>. But its latest vehicle, Geely’s Zeekr, is <a href="/2024/8/12/24218528/waymo-zeekr-geely-robotaxi-china-biden-tariff-ev-import">likely going to be waylaid by tariffs</a> on imports from China. <a href="https://x.com/aleximm/status/1828938865517965809">A recent analysis from JMP</a> found the company’s business in San Francisco to be profitable, while also estimating capital expenditures for the vehicle and sensor suite to be north of $150,000 per unit. </p></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">Lowering costs is going to be increasingly important for robotaxi companies as they look to expand to new cities. Alphabet doesn’t break out Waymo’s costs in its earnings report, but its “Other Bets” unit, which includes the robotaxi company, brought in $388 million in revenue in the <a href="https://abc.xyz/assets/71/a5/78197a7540c987f13d247728a371/2024q3-alphabet-earnings-release.pdf">third quarter of 2024</a>, up from $297 million a year ago. But the unit’s losses held flat at $1.12 billion compared to $1.94 billion in the year-earlier period. Alphabet recently led <a href="/2024/10/25/24279330/waymo-funding-round-series-c-amount-alphabet">a $5.6 billion funding round</a> for Waymo to help it cover costs as it eyes its next phase of growth. </p></div><div class="duet--article--article-body-component"><p class="duet--article--dangerously-set-cms-markup duet--article--standard-paragraph mb-20 font-fkroman text-18 leading-160 -tracking-1 selection:bg-franklin-20 dark:text-white dark:selection:bg-blurple [&_a:hover]:shadow-highlight-franklin dark:[&_a:hover]:shadow-highlight-blurple [&_a]:shadow-underline-black dark:[&_a]:shadow-underline-white">We know the technology works, but for driverless cars to have a real chance, we need to see evidence that it can make money, too. </p></div></div><div class="mb-40 mt-30"><button class="duet--article--comments-button group inline-flex h-40 w-full items-center justify-center rounded-[2px] border-[1px] border-solid border-blurple font-polysans-mono text-11 font-light uppercase tracking-12 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It’s a purpose-built, Level 4 autonomous vehicle, meaning it’s built without the need for a human driver. And here’s the thing that should make US competitors nervous: adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000,” Baidu CEO Robin Li said in \u003ca href=\"https://seekingalpha.com/article/4739368-baidu-inc-bidu-q3-2024-earnings-call-transcript\"\u003ean earnings call\u003c/a\u003e."},"dropcap":false,"endmark":false,"lead":false},{"__typename":"EntryBodyParagraph","placement":{"id":"2aYlkK","alignment":null},"__isEntryBodyComponent":"EntryBodyParagraph","contents":{"html":"“All the strengths just mentioned above are driving us forward, paving the way to validate our business model,” Li added. "},"dropcap":false,"endmark":false,"lead":false},{"__typename":"EntryBodyPullquote","placement":{"id":"lF6Cgw","alignment":"HANG_LEFT"},"__isEntryBodyComponent":"EntryBodyPullquote","quote":{"html":"Adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000”"}},{"__typename":"EntryBodyParagraph","placement":{"id":"mkKqCx","alignment":null},"__isEntryBodyComponent":"EntryBodyParagraph","contents":{"html":"With Alphabet’s Waymo operating in multiple cities in the US and Baidu deploying hundreds of vehicles in China, the world is now getting its first taste of an autonomous future. These vehicles are geofenced, meaning they can only operate in a select geographic area. And sure, they occasionally get confused or block traffic. But they’re real, and they’re growing in number. "},"dropcap":false,"endmark":false,"lead":false},{"__typename":"EntryBodyParagraph","placement":{"id":"6Bf1H0","alignment":null},"__isEntryBodyComponent":"EntryBodyParagraph","contents":{"html":"But it’s Baidu’s achievements in cost-effectiveness that should have Waymo and other robotaxi operators a little uncomfortable. Because while the technology is growing more mature, the economics of a robotaxi business are still very much unproven. "},"dropcap":false,"endmark":false,"lead":false},{"__typename":"EntryBodyParagraph","placement":{"id":"ZRzve3","alignment":null},"__isEntryBodyComponent":"EntryBodyParagraph","contents":{"html":"We still don’t know the net effect of Baidu’s cost improvements. But bringing down the upfront cost of each individual vehicle to below $30,000 will go a long way toward improving the company’s unit economics, in which each vehicle brings in more money than it costs. There are still a lot of outstanding costs to consider, such as hardware depreciation and fleet maintenance, but from what Baidu is signaling, things are on the right track. "},"dropcap":false,"endmark":false,"lead":false},{"__typename":"EntryBodyParagraph","placement":{"id":"fEaxj4","alignment":null},"__isEntryBodyComponent":"EntryBodyParagraph","contents":{"html":"From the looks of it, the company is passing those savings along to its customers. Base fares start as low as 4 yuan (around 55 cents), compared with 18 yuan (around $2.48) for a taxi driven by a human, according to \u003ca href=\"https://www.globaltimes.cn/page/202407/1315784.shtml\"\u003estate media outlet \u003cem\u003eGlobal Times\u003c/em\u003e\u003c/a\u003e. Apollo Go said it has provided 988,000 rides across all of China in Q3 2024 — a year-over-year growth of 20 percent. And cumulative public rides reached 8 million in October."},"dropcap":false,"endmark":false,"lead":false},{"__typename":"EntryBodyImage","placement":{"id":"xJABDb","alignment":null},"__isEntryBodyComponent":"EntryBodyImage","contentWarning":"","image":{"url":"https://cdn.vox-cdn.com/thumbor/5jkeMbZe5GZ-R2V0EQgf7XmAddU=/0x0:5000x3750/5000x3750/filters:focal(2500x1875:2501x1876)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749767/2170970455.jpg","height":3750,"width":5000,"hideCredit":false,"caption":null,"credit":{"html":"Photo by Smith Collection / Gado / Getty Images"},"asset":{"title":"Waymo Self-driving car"}}},{"__typename":"EntryBodyParagraph","placement":{"id":"cVyveZ","alignment":null},"__isEntryBodyComponent":"EntryBodyParagraph","contents":{"html":"With Waymo, we just don’t know. The company has spoken publicly about its efforts to reduce the costs of each vehicle by \u003ca href=\"https://www.theverge.com/2024/8/19/24223655/waymos-new-robotaxi-will-feature-fewer-sensors-to-help-lower-costs\"\u003eusing fewer sensors\u003c/a\u003e. But its latest vehicle, Geely’s Zeekr, is \u003ca href=\"https://www.theverge.com/2024/8/12/24218528/waymo-zeekr-geely-robotaxi-china-biden-tariff-ev-import\"\u003elikely going to be waylaid by tariffs\u003c/a\u003e on imports from China. \u003ca href=\"https://x.com/aleximm/status/1828938865517965809\"\u003eA recent analysis from JMP\u003c/a\u003e found the company’s business in San Francisco to be profitable, while also estimating capital expenditures for the vehicle and sensor suite to be north of $150,000 per unit. "},"dropcap":false,"endmark":false,"lead":false},{"__typename":"EntryBodyParagraph","placement":{"id":"tDx3ul","alignment":null},"__isEntryBodyComponent":"EntryBodyParagraph","contents":{"html":"Lowering costs is going to be increasingly important for robotaxi companies as they look to expand to new cities. Alphabet doesn’t break out Waymo’s costs in its earnings report, but its “Other Bets” unit, which includes the robotaxi company, brought in $388 million in revenue in the \u003ca href=\"https://abc.xyz/assets/71/a5/78197a7540c987f13d247728a371/2024q3-alphabet-earnings-release.pdf\"\u003ethird quarter of 2024\u003c/a\u003e, up from $297 million a year ago. But the unit’s losses held flat at $1.12 billion compared to $1.94 billion in the year-earlier period. Alphabet recently led \u003ca href=\"https://www.theverge.com/2024/10/25/24279330/waymo-funding-round-series-c-amount-alphabet\"\u003ea $5.6 billion funding round\u003c/a\u003e for Waymo to help it cover costs as it eyes its next phase of growth. "},"dropcap":false,"endmark":false,"lead":false},{"__typename":"EntryBodyParagraph","placement":{"id":"4c9OZ6","alignment":null},"__isEntryBodyComponent":"EntryBodyParagraph","contents":{"html":"We know the technology works, but for driverless cars to have a real chance, we need to see evidence that it can make money, too. "},"dropcap":false,"endmark":false,"lead":false}]},"liveCoverageStart":null,"slug":"2024/11/22/24303299/baidu-apollo-go-rt6-robotaxi-unit-economics-waymo","layoutTemplate":"STANDARD","seoSchema":[{"@context":"http://schema.org/","@type":"NewsArticle","headline":"Baidu’s supercheap robotaxis should scare the hell out of the US","description":"China’s Baidu is launching its sixth-generation robotaxi, which it claims costs less than $30,000 to manufacture. That should make Waymo and other US operators nervous.","datePublished":"2024-11-22T18:01:36.743Z","dateModified":"2024-11-22T18:01:36.743Z","thumbnailUrl":"https://cdn.vox-cdn.com/thumbor/W6yWtsib7dZip4AyzV1l-VCSZsU=/0x0:4500x3000/1400x788/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","author":[{"@type":"Person","name":"Andrew J. Hawkins","url":"https://www.theverge.com/authors/andrew-j-hawkins"}],"publisher":{"@type":"Organization","name":"The Verge","logo":{"@type":"ImageObject","url":"https://cdn.vox-cdn.com/uploads/chorus_asset/file/24015294/verge_duet_google_news.png","width":250,"height":50}},"image":[{"@type":"ImageObject","url":"https://cdn.vox-cdn.com/thumbor/W6yWtsib7dZip4AyzV1l-VCSZsU=/0x0:4500x3000/1400x788/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","width":1400,"height":788},{"@type":"ImageObject","url":"https://cdn.vox-cdn.com/thumbor/-N4IukZcsbxvobpS4ylJRa4I770=/0x0:4500x3000/1400x1050/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","width":1400,"height":1050},{"@type":"ImageObject","url":"https://cdn.vox-cdn.com/thumbor/tQOo28g3j9NBqDm0s6oaTdscjX0=/0x0:4500x3000/1400x1400/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","width":1400,"height":1400}],"url":"https://www.theverge.com/2024/11/22/24303299/baidu-apollo-go-rt6-robotaxi-unit-economics-waymo","articleBody":"Baidu’s robotaxi division, Apollo Go, just rolled out its latest robotaxi across multiple cities in China, and if stakeholders in the US aren’t nervous yet, they should be.\n\nThe RT6 is the sixth generation of Apollo Go’s driverless vehicle, which made its official debut in May 2024. It’s a purpose-built, Level 4 autonomous vehicle, meaning it’s built without the need for a human driver. And here’s the thing that should make US competitors nervous: adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000,” Baidu CEO Robin Li said in an earnings call.\n\n“All the strengths just mentioned above are driving us forward, paving the way to validate our business model,” Li added. \n\n\"Adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000”\"\n\nWith Alphabet’s Waymo operating in multiple cities in the US and Baidu deploying hundreds of vehicles in China, the world is now getting its first taste of an autonomous future. These vehicles are geofenced, meaning they can only operate in a select geographic area. And sure, they occasionally get confused or block traffic. But they’re real, and they’re growing in number. \n\nBut it’s Baidu’s achievements in cost-effectiveness that should have Waymo and other robotaxi operators a little uncomfortable. Because while the technology is growing more mature, the economics of a robotaxi business are still very much unproven. \n\nWe still don’t know the net effect of Baidu’s cost improvements. But bringing down the upfront cost of each individual vehicle to below $30,000 will go a long way toward improving the company’s unit economics, in which each vehicle brings in more money than it costs. There are still a lot of outstanding costs to consider, such as hardware depreciation and fleet maintenance, but from what Baidu is signaling, things are on the right track. \n\nFrom the looks of it, the company is passing those savings along to its customers. Base fares start as low as 4 yuan (around 55 cents), compared with 18 yuan (around $2.48) for a taxi driven by a human, according to state media outlet Global Times. Apollo Go said it has provided 988,000 rides across all of China in Q3 2024 — a year-over-year growth of 20 percent. And cumulative public rides reached 8 million in October.\n\n[Image: https://cdn.vox-cdn.com/thumbor/5jkeMbZe5GZ-R2V0EQgf7XmAddU=/0x0:5000x3750/5000x3750/filters:focal(2500x1875:2501x1876)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749767/2170970455.jpg]\n\nWith Waymo, we just don’t know. The company has spoken publicly about its efforts to reduce the costs of each vehicle by using fewer sensors. But its latest vehicle, Geely’s Zeekr, is likely going to be waylaid by tariffs on imports from China. A recent analysis from JMP found the company’s business in San Francisco to be profitable, while also estimating capital expenditures for the vehicle and sensor suite to be north of $150,000 per unit. \n\nLowering costs is going to be increasingly important for robotaxi companies as they look to expand to new cities. Alphabet doesn’t break out Waymo’s costs in its earnings report, but its “Other Bets” unit, which includes the robotaxi company, brought in $388 million in revenue in the third quarter of 2024, up from $297 million a year ago. But the unit’s losses held flat at $1.12 billion compared to $1.94 billion in the year-earlier period. Alphabet recently led a $5.6 billion funding round for Waymo to help it cover costs as it eyes its next phase of growth. \n\nWe know the technology works, but for driverless cars to have a real chance, we need to see evidence that it can make money, too. \n"}],"package":null,"url":"https://www.theverge.com/2024/11/22/24303299/baidu-apollo-go-rt6-robotaxi-unit-economics-waymo","commentsClosed":false,"railComponents":[{"__typename":"EntryRailNewsletter","entryRailNewsletter":{"name":"Verge Deals","slug":"deals"}}],"dek":{"plaintext":"Apollo Go’s sixth-generation driverless car is here."},"leadImage":{"defaultImageUrl":"https://cdn.vox-cdn.com/thumbor/Jo4ksCulvnfMs4eVK4S42FCiDGw=/0x0:4500x3000/1200x628/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg","asset":{"title":"Baidu Apollo Go robotaxi","contentType":"image/jpeg"}},"seoDescription":{"plaintext":"China’s Baidu is launching its sixth-generation robotaxi, which it claims costs less than $30,000 to manufacture. That should make Waymo and other US operators nervous. "},"socialDescription":{"plaintext":"The vehicle costs less than $30,000 to manufacture. "},"socialImage":null,"shouldUseHTMLNoindex":false,"shouldUseHTMLNofollow":false,"password":null,"additionalContributors":null,"_id":24067340,"leadComponent":{"__typename":"EntryLeadImage","standard":{"hideCredit":false,"asset":{"title":"Baidu Apollo Go robotaxi"},"caption":null,"credit":{"html":"Image: Getty"},"variantUrl":"https://cdn.vox-cdn.com/thumbor/63SFwmyTeFqwS5NaqRempU17r68=/0x0:4500x3000/2000x1333/filters:focal(2250x1500:2251x1501)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749641/2165011649.jpg"}},"liveCoverageEnd":null,"seoArticleBody":"Baidu’s robotaxi division, Apollo Go, just rolled out its latest robotaxi across multiple cities in China, and if stakeholders in the US aren’t nervous yet, they should be.\n\nThe RT6 is the sixth generation of Apollo Go’s driverless vehicle, which made its official debut in May 2024. It’s a purpose-built, Level 4 autonomous vehicle, meaning it’s built without the need for a human driver. And here’s the thing that should make US competitors nervous: adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000,” Baidu CEO Robin Li said in an earnings call.\n\n“All the strengths just mentioned above are driving us forward, paving the way to validate our business model,” Li added. \n\n\"Adopting a battery-swapping solution, the price for one individual RT6 is “under $30,000”\"\n\nWith Alphabet’s Waymo operating in multiple cities in the US and Baidu deploying hundreds of vehicles in China, the world is now getting its first taste of an autonomous future. These vehicles are geofenced, meaning they can only operate in a select geographic area. And sure, they occasionally get confused or block traffic. But they’re real, and they’re growing in number. \n\nBut it’s Baidu’s achievements in cost-effectiveness that should have Waymo and other robotaxi operators a little uncomfortable. Because while the technology is growing more mature, the economics of a robotaxi business are still very much unproven. \n\nWe still don’t know the net effect of Baidu’s cost improvements. But bringing down the upfront cost of each individual vehicle to below $30,000 will go a long way toward improving the company’s unit economics, in which each vehicle brings in more money than it costs. There are still a lot of outstanding costs to consider, such as hardware depreciation and fleet maintenance, but from what Baidu is signaling, things are on the right track. \n\nFrom the looks of it, the company is passing those savings along to its customers. Base fares start as low as 4 yuan (around 55 cents), compared with 18 yuan (around $2.48) for a taxi driven by a human, according to state media outlet Global Times. Apollo Go said it has provided 988,000 rides across all of China in Q3 2024 — a year-over-year growth of 20 percent. And cumulative public rides reached 8 million in October.\n\n[Image: https://cdn.vox-cdn.com/thumbor/5jkeMbZe5GZ-R2V0EQgf7XmAddU=/0x0:5000x3750/5000x3750/filters:focal(2500x1875:2501x1876)/cdn.vox-cdn.com/uploads/chorus_asset/file/25749767/2170970455.jpg]\n\nWith Waymo, we just don’t know. The company has spoken publicly about its efforts to reduce the costs of each vehicle by using fewer sensors. But its latest vehicle, Geely’s Zeekr, is likely going to be waylaid by tariffs on imports from China. A recent analysis from JMP found the company’s business in San Francisco to be profitable, while also estimating capital expenditures for the vehicle and sensor suite to be north of $150,000 per unit. \n\nLowering costs is going to be increasingly important for robotaxi companies as they look to expand to new cities. Alphabet doesn’t break out Waymo’s costs in its earnings report, but its “Other Bets” unit, which includes the robotaxi company, brought in $388 million in revenue in the third quarter of 2024, up from $297 million a year ago. But the unit’s losses held flat at $1.12 billion compared to $1.94 billion in the year-earlier period. Alphabet recently led a $5.6 billion funding round for Waymo to help it cover costs as it eyes its next phase of growth. \n\nWe know the technology works, but for driverless cars to have a real chance, we need to see evidence that it can make money, too. \n","stream":null,"visibleNetworkIds":[],"scheduledForExpirationAt":null}}}]},"uid":"Entry:5cde1a09-6bf8-4677-b0c0-461e24d96b07","mostPopular":[{"author":{"fullName":"Mia Sato"},"publishDate":"2024-11-26T14:32:50","title":"Bad influence","url":"https://www.theverge.com/2024/11/26/24303161/amazon-influencers-lawsuit-copyright-clean-aesthetic-girl-sydney-nicole-gifford-alyssa-sheil","uid":"0"},{"author":{"fullName":"Sheena Vasani"},"publishDate":"2024-11-27T00:03:09","title":"Max, Hulu, and Paramount Plus are all heavily discounted for Black Friday","url":"https://www.theverge.com/24306534/black-friday-2024-streaming-best-deals-max-hulu-peacock-paramount-plus-cyber-monday","uid":"1"},{"author":{"fullName":"Umar Shakir"},"publishDate":"2024-11-26T17:42:18","title":"Elon Musk learns how EV charging works from Pete Buttigieg","url":"https://www.theverge.com/2024/11/26/24306385/elon-musk-pete-buttigieg-nevi-funding-ev-chargers-explainer","uid":"2"},{"author":{"fullName":"David Nield"},"publishDate":"2024-11-26T14:00:00","title":"How to use Google Gemini on your phone","url":"https://www.theverge.com/24305656/gemini-google-assistant-android-how-to","uid":"3"},{"author":{"fullName":"Quentyn Kennemer"},"publishDate":"2024-11-26T18:44:42","title":"Hulu’s best Black Friday deal is back with $.99 a month for an entire year","url":"https://www.theverge.com/2024/11/26/24306632/hulu-disney-plus-ads-bundle-black-friday-deal-sale","uid":"4"}],"navProps":{"campaignGroup":null,"stickyNav":true,"logoColor":"franklin","lightText":false},"_sentryTraceData":"db401558c6f44e1f810437ead678a1e3-b1e817496438f07a-0","_sentryBaggage":"sentry-environment=production,sentry-release=eRiIIZjNhI1r-REYnWsjp,sentry-public_key=6547365f9d98454ba8daa58e42013d33,sentry-trace_id=db401558c6f44e1f810437ead678a1e3"},"__N_SSP":true},"page":"/entry/standard/[uid]","query":{"uid":"Entry:5cde1a09-6bf8-4677-b0c0-461e24d96b07"},"buildId":"eRiIIZjNhI1r-REYnWsjp","isFallback":false,"gssp":true,"scriptLoader":[{"src":"https://theverge.coral.coralproject.net/assets/js/count.js?v=0","strategy":"lazyOnload","className":"coral-script","defer":true}]}</script></body></html>