(Reuters) - Chinese electric car startup Nio Inc (NIO.N) and Intel Corp’s (INTC.O) self-driving car technology firm Mobileye on Tuesday said they would partner to develop autonomous vehicles for the consumer market in China and eventually other countries.
Under the agreement, Nio will manufacture and produce at mass scale a self-driving system designed by Mobileye, which will be integrated into Nio’s electric-vehicle consumer lines, as well as Mobileye’s driverless ride-hailing services.
Shares in Nio surged 23% on the news.
The self-driving kit provided by Israel-based Mobileye includes the vision processing chip, camera, radar and lidar sensors, as well as safety and mapping software.
Nio will also develop a version of self-driving electric vehicles that Mobileye will deploy as robotaxis for ride-hailing services in global markets.
No financial details of the partnership were disclosed.
The companies plan an initial release in China beginning in 2022, Mobileye President and Chief Executive Officer Amnon Shashua told Reuters in an interview on Monday.
“The deal with Nio will also enable us to harvest data in compliance with Chinese regulations and improve mapping to support autonomous driving,” Shashua said.
Shashua said his company also had “strategic partnerships with a number of Chinese carmakers” to work on autonomous cars, without elaborating further.
The Mobileye CEO added that a rollout in China was more efficient as the regulatory environment was centralized and the Chinese government was working on standardizing Mobileye’s safety model for self-driving cars into law.
Manufacturers and suppliers are increasingly sceptical about the speed of adoption of fully automated self-driving systems, because of their high cost, complexity, and regulatory hurdles.
In the meantime, they have begun focusing on deploying more advanced driver assistance systems (ADAS), which share components, but cost much less and can generate much-needed revenue to help defray the cost of developing full self-driving systems.
Mobileye on Tuesday said it powers ADAS in car models of more than 27 automakers.
Money-losing and cash-burning Nio is the most prominent among dozens of Chinese electric-vehicle startups vying to become the next Tesla Inc (TSLA.O). All are hampered by dwindling demand in the world’s largest car market, reduced government subsidies for EVs and nagging concerns over the China-U.S. trade war.
Nio on Tuesday said the partnership with Mobileye aligned with its mission to provide premium, smart electric cars and allowed it to maintain an edge over electric vehicle competitors.
Reporting by Tina Bellon; Editing by Stephen Coates and Jonathan Oatis