Can Kakao Mobility stay ahead as Waymo and Baidu target Korea’s robotaxi market?

Kakao Mobility, Korea’s largest taxi-hailing platform by market share, is facing questions over whether it can maintain its dominance in the self-driving era as U.S. and Chinese robotaxi giants accelerate their push into Korea and local rivals pull ahead in autonomous driving technology.

Hyundai Motor and autonomous driving startups Autonomous A2Z and RideFlux will participate in an autonomous driving demonstration city project set to begin next month in Gwangju and South Jeolla, according to IT industry sources Tuesday. Kakao Mobility also applied but was not selected.

The three participating companies have already completed development of their autonomous driving solutions and are undergoing compatibility testing. Once testing is completed, 200 autonomous vehicles will operate in Gwangju and South Jeolla, by the end of this year. The project aims to collect driving data needed to introduce Level 4 autonomous driving technology, which allows vehicles to operate without a driver on board.

The Ministry of Land, Infrastructure and Transport intends to expand the project next year to as many as 3,000 vehicles across five cities nationwide. It remains unclear whether Kakao Mobility will be selected to participate.

“Since Kakao Mobility was not selected for the Gwangju and South Jeolla demonstration project, it will be difficult for the company to demonstrate technology that is more competitive than that of the three companies that have already secured driving data in the region,” a senior autonomous driving industry source said.

Kakao Mobility has also yet to receive a temporary permit for driverless autonomous vehicle operation, the Korean authorization that allows vehicles to operate without anyone in the driver’s seat, as robotaxi services do in the United States and China.

Kakao Mobility announced on Sept. 9 that it had accumulated 13,000 kilometers (8,078 miles) of driving data after operating six autonomous vehicles for six months in southern Seoul’s Gangnam District, each carrying a safety operator in the driver’s seat. That falls short of the 15,000 kilometers required by the Transport Ministry for a temporary driverless autonomous vehicle permit. RideFlux is the only company in Korea to have received the permit.

Kakao Mobility also holds 26 related patents, fewer than RideFlux’s 73 and Autonomous A2Z’s 48.

“Kakao Mobility still uses map- and rule-based autonomous driving, which is outdated technology,” an executive at a Korean autonomous driving company said.

Adding to the pressure, major U.S. and Chinese autonomous driving companies are accelerating their expansion into Korea. Google’s Waymo established Waymo Korea in July and is testing driverless autonomous driving technology using Hyundai Ioniq 5 vehicles. Baidu established Baidu Apollo Go Korea in April and has since been seeking local partners.

Some in the industry are concerned that Kakao Mobility could follow a path similar to Uber’s. Uber began developing autonomous driving technology in 2015 but sold the division in 2020 amid pressure over its financial performance. It later partnered with Waymo, but found itself under pressure after Waymo opted to pursue its own platform rather than renew the partnership.

Kakao Mobility also moved early to set up an autonomous driving task force in 2018 to develop the technology in-house. But legal risks, including allegations that it favored certain taxis in allocating ride requests, prevented the company from sustaining investment in autonomous driving.

Its position as Korea’s largest taxi-hailing platform also became a constraint. The company found it difficult to invest aggressively because of concerns over opposition from the taxi industry.

Kakao Mobility dominated the era of human-driven taxis, but it is unclear whether its platform can maintain its current position once robotaxis enter the market.

The company is also losing funding and talent.

Private equity firm TPG, which has served as a financial partner since 2017, is focusing on exiting its investment by listing its stake in the United States in the form of American Depositary Receipts, or ADRs. Kakao Mobility’s former Chief Technology Officer You Seung-il, who previously worked at Google, left the company in 2024. Its Senior Vice President Chang Sung-wook, who led autonomous driving development, moved to Naver in September last year, while Director Park Il-suk, who was responsible for mapping technology, joined Naver in January.

Although Kakao Mobility may be late to the race, industry experts say it still has a chance to catch up.

Its expertise in fleet control and management, built through a platform used by 13 million people each month, could help compensate for shortcomings in its autonomous driving technology. Such capabilities would be difficult for competitors, including overseas companies, to replicate.

Industry attention is also turning to the 6.4 trillion won ($4.7 billion) in investment resources held by Kakao X, an investment company which is set to be spun off from Kakao.

“Kakao Mobility became a latecomer in autonomous driving because it neglected investment despite having the advantage of being the No. 1 taxi-hailing platform,” a former Kakao Mobility employee said. “The key will be where Kakao X chooses to invest its money.”

BY OH HYEON-WOO [[email protected]]