VOLVO Cars has teamed up with Chinese search engine operator Baidu to develop a self-driving taxi for China, it said Thursday, opening another frontier to secure its place in the robotaxi market while its Uber supply deal remains in limbo.

Volvo is one of a growing list of carmakers tying up with technology firms or rivals to split the huge cost of developing functional and safe self-drive systems.

Volvo said the venture will give it access to Baidu’s autonomous driving software Apollo, which it intends to use to develop a so-called Level 4 car, only one off the top level and the most sophisticated yet attempted by Volvo.

The top Level 5 designation is for vehicles that should be capable of navigating roads without any driver input in all conditions.

CEO Hakan Samuelsson said he expects sales of robotaxis to ride-hailing operators to account for a “significant portion” of the vehicles needed to hit its target of achieving a third of its sales from self-driving cars by 2025.

“Robotaxis is a segment where we will compete not as operators but by selling cars to firms we’ve sold to previously,” he said.

The race is on to be the first to introduce an autonomous product to the ride-hailing market, which already accounts for more than 30 percent of the global taxi market. Goldman Sachs analysts believe the value of the ride-hailing market could achieve an eightfold increase to US$285 billion by 2030.

Volvo is trying to make headway as a mid-size luxury player with more limited resources than a BMW or Audi and was forced to drop plans for an initial public offering this year because of international trade tensions and a downturn in share prices across the auto sector. (SD-Agencies)