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In the first of what is undoubtedly many to follow, Chinese multinational technology company Baidu has received authorization to roll out its fully driverless taxi services to the general public in China. Depending on how well the deployment goes, this milestone is expected to bring about a massive increase in the commercial use of self-driving technology and provide a boost to the autonomous ride-hailing industry.

According to a Baidu spokesperson, China is leading the way in research and development in addition to deploying the technology and is the first country in the world to permit completely driverless paid taxi services.

The new service will be operated by Apollo Go, Baidu's autonomous ride-hailing service, in specific areas of two large cities – Chongqing, a sprawling municipality in southwestern China with a population of 31 million people, and Wuhan, the capital of central China's Hubei province, which has a population of 11 million.

The new licenses to operate, granted by authorities in Wuhan and Chongqing, will allow Baidu to offer paid services for fully driverless taxis in 30 square kilometers of Chongqing from 9:30 am to 4:30 pm, and 13 square kilometers in the Wuhan Economic & Technological Development Zone from 9 am to 5 pm. Initially, only five self-driving vehicles will operate in each city.

Wei Dong, V.P. and Chief Safety Operations Officer of Baidu's Intelligent Driving Group, said it is a great qualitative change and that fully driverless cars offering paid journeys on public roads signifies that they have finally arrived at the moment the industry has been long waiting for.

To qualify for the permits to operate driverless, the self-driving taxis have undergone numerous stages of testing and licensing, beginning with a safety operator sitting behind the wheel to a safety operator sitting in the passenger seat, before finally receiving permission to operate self-driving vehicles without anyone in the car, Baidu said.

Zhang Xiang, an automobile industry innovation researcher at the North China University of Technology in Beijing, remarked that permission to run fully driverless taxis on public roads is a crucial milestone in the evolution from Level 3 to Level 4 self-driving, which signifies the car can self-drive in most circumstances without any human intervention.

"The move is of massive significance to significantly bring down labor costs and provides a firm foundation for supporting large-scale commercialization of autonomous driving technology in China," he said.

The cost to produce the components of the driverless vehicles, such as lidar sensors, has come down as advances have been made in self-driving technology and related industrial chains matured, he added.

Lyu Jinghong, an intelligent mobility analyst, continued that China has now caught up (if not overtaken) the United States in self-driving development, with Wuhan and Chongqing now having driverless taxis carrying passengers and charging fares.

More cities in China are expected to follow the two ground-breaking cities by gradually allowing pilot schemes for self-driving taxis and commercialization, which will help self-driving developers improve their technologies and find accurate business models.

Experts in the field have warned that the new technology should be adopted with caution, especially in regards to public safety.