(Yicai) July 11 -- Despite China's central and local governments recently launching policies to promote the commercialization of driverless vehicles, robotaxis still come up against many challenges, including limited operating areas and frequent license renewal, according to industry insiders.

Chinese cities plan to speed up the development of the local online autonomous ride-hailing industry but still face hurdles to achieving true commercialization, several industry insiders recently told Yicai.

Twenty Chinese cities or city consortiums, including Beijing and Shanghai, were included in the first batch to pilot the "car-road-cloud integration" application of intelligent connected vehicles, a notice on the website of the Ministry of Industry and Information Technology showed early this month.

These cities later released their local autonomous car industry management policies. Beijing will support the use of driverless vehicles for urban public electric bus transport, ride-hailing services, and car rentals, a draft issued by the Beijing Municipal Bureau of Economy and Information Technology to solicit feedback on regulations for these cars showed on July 8.

Driverless cars are hindered by limited operating space, with most cities allowing them to run only in demonstrative areas specified by the local government and not take passengers to outside destinations, experts told Yicai. This impacts the number of orders such cars receive on ride-hailing platforms.

A key reason behind the success of the robotaxi service of Apollo, the self-driving arm of Chinese tech giant Baidu, in Wuhan is that the whole city is open to unmanned cars, allowing them to have the same use scenarios as standard taxis, a professional said to Yicai.

The necessity to renew commercial operation licenses frequently also impacts the normal operation of robotaxi firms. Yicai recently tried to book a spot for an autonomous driving test in Shanghai's Pudong district but was informed that the company's temporary license had expired and it could not resume operation for about a week until it renewed the permit.

Commercial licenses issued by the Shanghai administration to self-driving cars have time limits and need to be reapplied for about every six months, the person in charge of the company told Yicai, adding that the situation is similar in other cities.

The license renewal process can take from several days to up to two months, the person pointed out. When waiting for the new licenses, the firm has to suspend robotaxi services, significantly impacting its business, he noted.

In addition to the frequent renewal and paying related fees for temporary licenses, the person added that a big problem for autonomous driving technology developers is that policies do not allow selling driverless vehicles to commercial companies. "Such transactions need to be legalized, which is our most urgent call."

Temporary licenses for driverless vehicles are only issued to the manufacturers of the cars, meaning that potential buyers cannot apply for a license and thus cannot own a self-driving car, the person said.

Autonomous cars cost hundreds of thousands of Chinese yuan, equivalent to tens of thousands of US dollars, and are a very heavy asset, the person noted. "As long as the ownership rights cannot be traded, a robotaxi business cannot form scale effect and can only stay in phase of small-scale trials."

Another key factor hindering the commercial operation of self-driving cars is that the industry's legislation is still vacant, according to industry insiders.

There is still no national law for the industry, a person in charge of a domestic autonomous driving tech firm told Yicai. The sector is managed with the support of local governments for new tech experiments, research, and development, the person said.

Only by accelerating the pace of legislation for autonomous driving can the industry's commercial use be fundamentally advanced, the person pointed out.

However, local governments have started promoting legislation for the autonomous driving industry. Hangzhou became the first Chinese city to specify procedures enabling self-driving cars to run on roads with legislation and was also the first to make laws for low-speed driverless vehicles in May, while Beijing plans to legislate to support robotaxis.

Beijing's draft aims to give autonomous car innovation activities a certain and open management framework, offering a legal guarantee to drive the industry's high-quality development, noted a relevant person in charge at the Beijing Municipal Bureau of Economy and Information Technology. It specifies how to determine legal responsibility in traffic violations involving unmanned cars, the person said.

Editors: Tang Shihua, Martin Kadiev