Audi will enhance Chinese connected-car services with Baidu

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Germany’ Audi (VOWG_p.DE) enhance connected-car services in China meet growing demand for driver-assistance systems and driverless technology in the world’ largest auto market.

Volkswagen’ flagship luxury brand said Friday jointly develop navigation map data, positioning algorithms and point-of-interest functions China’s web services provider Baidu.

Chinese Internet companies and auto makers have been quick up start developing partly self-driving and Internet-connected cars, following a path already trodden by U.S. tech giants Inc and Apple Inc.

“We are now taking our next big step in China,” Executive Rupert Stadler said at the carmaker’s annual shareholder meeting in Neckarsulm, Germany. “The virtual and real worlds are merging.”

The greater use of electronics and software in vehicles, and the ability of cars to connect to smartphones and devices, is providing automakers, suppliers and technology firms new business opportunities.

Audi and Baidu agreed a memorandum of understanding in January and sign a contract their partnership at the May 25-27 international Consumer Electronics Show (CES) in Shanghai.

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Ingolstadt-based Audi also said will develop a China-specific LTE module Huawei [HWT.UL] to deliver fast-data transmission for use in China, Japan and Korea.

Germany’s premium carmakers Mercedes, Audi and BMW have teamed up with private equity firm General Atlantic to increase their firepower as they’re jointly bidding for Nokia’s mapping unit HERE, two sources told Reuters Thursday.

Separately, Audi reaffirmed aims to increase sales significantly this year beyond the record 1.74 million cars achieved in 2014. This translates into growth of between five and 9.9 percent, a said.

Stadler said the planned Q8 flagship sport-utility vehicle (SUV) will be launched in 2019, a year after a new electric SUV will come to market.