Wuhan leads China's embrace of robotaxis. What's behind the surge?

China's robotaxi is seeing an order surge in the megacity of Wuhan in central China's Hubei Province. Daily peak orders are reportedly exceeding 20 per vehicle, catching up to the volume of those from a traditional taxi, multiple media outlets reported, citing "Hubei Release," an account affiliated with the local government's news center.

Various keywords related to Apollo Go, Baidu's autonomous ride-hailing platform, have made it to the top 10 trending topics on Weibo, China's popular social media platform.

"Well, this is one way to drive new tech growth," Financial Times column writer June Yoon said in a recent article.

But apart from the surge in business growth for the company, many questions have arisen regarding its safety, the challenge it poses to the manned taxi and ride-hailing industry, and the broader implications for urban transportation.

How safe is it?

"Comparable to that of China's domestically produced C919 large passenger aircraft," said Yin Ying, the general manager of the automotive robot department at Baidu. Yin was referring to the sixth-generation autonomous driving vehicles that have been deployed to the Apollo Go fleet in Wuhan since their launch in May at Baidu's Apollo Day 2024 event.

These vehicles are equipped with Baidu's latest Autonomous Driving Foundation Model solution, which integrates a large-scale AI model, advanced hardware products and a robust safety architecture. The company claims this system is capable of reaching Level 4 (L4) autonomous driving – vehicles that can operate without human intervention in the majority of driving scenarios.

Most of the current running vehicles in Wuhan are Baidu's fifth-generation autonomous driving cars, "Apollo Moon," developed in collaboration with China's electric vehicle brand Arcfox.

In terms of operation, Wuhan has two types of robotaxis: one operates in full driverless mode, supervised by remote safety operators, and the other is manned by human drivers behind the wheel.

According to a guideline issued by the Ministry of Transport of the People's Republic of China, the ratio of remote safety officers to vehicles must not be lower than 1 to 3.

As of April, Baidu's autonomous driving program has accumulated 100 million kilometers in driving distance without a single major casualty incident, the company reports. 

However, that near-zero safety record was recently challenged by a minor accident in Hanyang District of Wuhan on July 7. An autonomous driving taxi was involved in a slight contact with a pedestrian who ran a red light as the vehicle started to move on a green light, according to an announcement made by Apollo Go on July 10.

"Thankfully, no significant injuries were found, and the person is currently under further observation and resting at the hospital," the company said.

Why do people embrace it in China?

Robotaxis might be creating a buzz in Wuhan, as the city is known as the "Chinese Motor Valley," a hub for China's automotive industry with a strong foundation in vehicle manufacturing and technology innovation. 

In fact, the service has been introduced to numerous cities in China. As of now, Baidu has opened manned test operation services in 11 cities and is conducting fully driverless autonomous driving service tests in Beijing, Wuhan, Chongqing, Shenzhen and Shanghai. Meanwhile, Pony.AI, another key player in China, currently has nearly 100 robotaxis in Beijing and plans to expand to thousands within the next two years, according to Zhang Ning, vice president of Pony.AI, who spoke to reporters from the Beijing Business Daily.

It is believed that Baidu is gaining more attention as its auto-pilot fleet is larger, according to Zhang Junyi, partner of global consulting company Oliver Wayman. Zhang oversees the automotive practice in China and has been watching the industry for decades. 

According to Hubei Daily, Apollo Go has deployed over 400 self-driving vehicles in the city. The service covers an area of more than 3,000 square kilometers and a population of 7.7 million in Wuhan. In certain areas of the city, the service has expanded to be 24/7 operational.

Online discussions have shown that people are attracted to such new services for their competitive price point, good service and "good smell" inside the car, as quoted in a recent article by Southern Metropolises Daily.

"Chinese consumers particularly enjoy trying new things, even if it's just for the experience," Zhang said in an interview with CGTN, adding that he anticipates a growing number of consumers will embrace these innovative rides.

A "Tesla-heated" topic

Robotaxis is not a new topic, as Google's Waymo introduced its first-generation driverless test car platform in 2012. Waymo and several other companies are currently operating fully autonomous robotaxis in several US cities.

Tesla is reportedly delaying its long-promised fully autonomous robotaxi until October, Bloomberg reports.

"Tesla's previous announcement of dropping the robotaxi service in August on top of its plan to roll out advanced full self-driving in China all speed up Chinese companies' moves," Zhang said.

Challenges ahead

The rising demand for robotaxis, driven by lower price offers, has generated fear among taxi drivers.

"When autonomous driving technology proves to be safer than human driving, driving manually may become a luxury. This major trend is unstoppable. Therefore, we must assess whether its entry into the market is disruptive," said Zhang.

Zhang added that if Baidu continues to ramp up market subsidies and make blind investments, it could alter the ride-hailing and taxi market not by increasing industry profits but by reducing overall expenditures. This change wouldn't increase industry profits but rather decrease overall consumption within the sector. Such a shift could disrupt the market order and have broader economic implications.

Meanwhile, new opportunities are emerging in this burgeoning sector. In June, China's Ministry of Human Resources and Social Security announced plans to add 19 new professions to the occupational catalog, which included testers for intelligent connected vehicles, among others. 

With the expansion of the robotaxi fleet, there is a noted increase in demand for roles such as safety officers and vehicle maintenance technicians, as highlighted by Huang Hantao, the director of government affairs at Pony.AI, in a recent interview with The Paper.

Job postings on Boss Zhipin, a recruitment platform in China that serves a function similar to Glassdoor, indicate that autonomous driving safety officers are listed with monthly salaries ranging from 5,000 to 7,000 yuan (approximately $690-$960).

The article by Southern Metropolises Daily stated, "We cannot solely rely on the broad assertion that 'new technology will create more jobs' to comfort those traditional workers who genuinely feel the career crisis due to technological shifts. The situation is entirely different for the tech elites capable of delving into the blue ocean of autonomous driving and the traditional ride-hailing drivers. The latter group clearly requires more secure and cautious support, as well as the creation of opportunities."

"As leading enterprises in the industry, they should put more consideration on social impact while pursuing technological progress and corporate benefits," Zhang said.