Beijing (PingWest)- China’s search giant Baidu has announced that it is partnering with automaker Zhejaing Geely Holding Group to build smart electric vehicles (EV).

Baidu, which has been developing autonomous driving technology, said it is setting up a new company to manufacture intelligent electric cars, and the new EV company will count on Baidu’s intelligent driving system Apollo and Geely’s car manufacturing expertise and EV modular platform-Sustainable Experience Architecture.

Geely, which owns Volvo and a stake in Mercedes-Benz parent company Germany automaker Dailmer, will be a strategic investor in the new company.

“As a top Chinese automaker with global reach, Geely has the unique experience and resources to design, produce and market energy-efficient, reliable, and safe automobiles in large scale,” Baidu CEO Robin Li said in a statement.

“We believe that by combining Baidu's expertise in smart transportation, connected vehicles and autonomous driving with Geely's expertise as a leading automobile and EV manufacturer, the new partnership will pave the way for future passenger vehicles."

Baidu established its autonomous driving system Apollo in 2017, which mainly supplies open-source technology powered by artificial intelligence and partner with a number of Chinese carmakers including FAW Group, Sokon and electric vehicle startup Nio, as well as international car companies including BMW, Ford Motor Co, Volkswagen, Toyota, Honda, Daimler.

However, until now, Baidu hasn’t yet to manufacture cars by itself, instead, the company have been focused on providing technologies to other car companies, a similar approach used by Alphabet’s Waymo.  

Baidu’s announcement come at the time when tech companies are racing to develop smart cars.

Internet giants including Tencent, Amazon and Alphabet have all developed auto-related technology or invested in smart-car startups in recent years.

China’s e-commerce giant Alibaba has formed an EV joint venture with Geely’s competitor SAIC.