Public transport software provider China TransInfo announced Monday a RMB 3.59 billion (around $520 million) investment from Alibaba, which is moving into the smart vehicle market with cloud-based solutions.
Alibaba acquired a 15% stake in the company at RMB 16.12 ($2.34) per share from Xia Shudong, China TransInfo’s president, and some affiliated enterprises. The e-commerce giant is the company’s second-largest shareholder after Xia, according to an announcement released Tuesday. Shares of the Shenzhen-listed company soared 10.0% to RMB 20.21 by market close the same day.
The two parties will work together to accelerate the mass deployment of intelligent public transport solutions and cloud-based services for public security over the next three years, said the company in the announcement. Alibaba did not reveal further details when contacted by TechNode on Tuesday.
The Alibaba deal comes less than a year after China TransInfo inked an agreement with another Chinese tech giant, Baidu, in late September. China TransInfo provides networking and data services for Baidu’s autonomous vehicle (AV) driving tests under the deal. The company says it has been authorized by the Ministry of Industry and Information Technology to lead the construction of Beijing’s first intelligent vehicle and transportation pilot zone since 2016, according its website.
Alibaba reportedly made its first foray into the autonomous driving market in April 2018, when it began testing its in-house Level 4 driverless technologies. This was immediately followed by a joint lab announcement with the China Academy of Transportation Sciences, a research institute under the Ministry of Transport, for the development of Vehicle-To-Everything (V2X) technology solutions.
Deployed in vehicles, signal lights, and other traffic infrastructure, V2X technology facilitates real-time communication between traffic-related elements. Chinese government plans to install wireless communication solution (LTE-V2X) with censors in 90% of highways in the country by 2020, as it revamps its road and highway infrastructure using homegrown mobility technologies.
Founded by Xia, who graduated from Peking University with a doctorate in 2000, China TransInfo is a major software system provider to local governments, with a focus in public transport. It offers software solutions for city command centers, subway stations, and electronic toll collection (ETC) in around 30 Chinese provinces and municipalities.