Alibaba Cloud, Deloitte set up China facility to drive automotive applications

Alibaba Cloud and Deloitte China have teamed up to launch a facility that focuses on developing applications for the automotive sector. The new center looks to tap a market they say will be home to the world’s largest autonomous vehicle industry by 2035.

Called Deloitte-Alibaba Cloud Auto Industry Center, the new site will develop applications that include autonomous driving, smart manufacturing, and digital marketing, the two partners said in a joint statement Tuesday.

The center will be supported by Deloitte China’s automotive cloud services team that specializes in products and services that encompass digital supply chain, intelligent network connectivity, and cybersecurity. Alibaba’s cloud computing resources spanning artificial intelligence (AI) and networking will also be tapped.

The two companies added that their partnership would look to facilitate the automotive sector’s cloud deployment and digitalization efforts.

Citing Deloitte’s research, Deloitte China’s automotive industry lead Andy Zhou said China was projected to be the world’s largest autonomous vehicles market by 2035, with more than 5.7 million such vehicles. Worldwide, by 2030, there would 82.5 million autonomous vehicles.

Zhou said: “Chinese autonomous driving industry is pioneering a new era driven by technology competition, ecology, consumer perceptions, and regulations.”

Alibaba currently delivers cloud services to more than 70% of China’s automotive industry, according to its general manager for vehicle industry, Li Qiang. “As software-defined vehicles become more popular, we are confident to support more enterprises digitalization journey and, eventually, be cloud-native to enjoy the benefits brought about by the digitalization of the entire vehicle value chain.”

China last week released its first set of draft rules outlining guidelines on the deployment of self-driving public transport vehicles, such as buses on its Bus Rapid Transit system. Categorizing such vehicles into three key groups based on the autonomous capabilities, the proposed laws would allow autonomous vehicles to facilitate taxi services under controllable scenarios and provide a reference point for local agencies.

Chinese automotive manufacturer Baidu last week rolled out commercial driverless taxi services in Wuhan and Chongqing, expanding the transport option beyond the country’s capital Beijing. The move comes after it secured regulatory approvals to collect fares for its driverless taxi service Apollo Go in the two Chinese cities.

In his comments on the company’s latest quarterly results, Alibaba CEO Daniel Zhang said its cloud revenue grew 10% year-on-year, reflecting a slowdown in growth due to various factors that included slowing macroeconomic activities, softer demand from domestic internet customers, and delays in its hybrid cloud initiatives due to the reemergence of COVID-19.

Amidst this backdrop, Zhang said Alibaba would continue to focus on boosting its cloud capabilities in key areas such as AI and tapping growth opportunities in “sunrise industries and customers”. He noted that non-internet industries contributed 53% of the company’s cloud revenue in the recent quarter, up more than 5% year-on-year.

The Chinese government last December outlined a five-year plan to drive its ambition of becoming a global innovation hub for robotics by 2025, with the country’s robotics industry projected to grow an average 20% between 2021 and 2025. China is expecting high-end advanced robots to be adopted across more sectors, including automobile, aerospace, railway, logistics, and mining.