Shares of Pony AI (PONY 38.87%) are flying higher on Tuesday. The stock has gained 34.3% as of 12:12 p.m. ET and was up by as much as 37% earlier in the day. The move comes as the S&P 500 and Nasdaq Composite indexes slipped 0.5% and 0.6%, respectively.
Pony, a Chinese autonomous vehicle company, will partner with Uber Technologies to deploy its technology in Middle East markets later this year.
Pony will power self-driving cars globally
Uber announced Tuesday that it will partner with Pony AI to begin offering autonomous robotaxi services in key markets in the Middle East before expanding to additional global markets in the future. The rollout will begin with “safety operators” in the driver’s seats until the human operators are phased out.
Another step forward for Pony
The collaboration is a key partnership that helps Pony AI in its quest to expand globally. Currently operating in select Chinese cities, the company is already exploring expanding to South Korea, Luxembourg, and Hong Kong.
The company had announced another partnership just weeks ago with the Chinese tech giant Tencent, boosting its profile. This latest partnership further validates the company’s technology outside the Chinese market.
Image source: Getty Images
The robotaxi market is crowded
Pony AI and Uber are up against big players with robotaxi aspirations like Tesla and Alphabet‘s Waymo. Competing with them is a tall order, but the company’s strategy of partnering with larger, more established companies that already have massive user bases is a smart one. The company is still operating in the red and has relatively minimal sales, but that will change as the company’s robotaxis are deployed globally. This is definitely a higher-risk stock, but if you have a tolerance for that, I think it’s a good pick.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Tesla, and Uber Technologies. The Motley Fool has a disclosure policy.