Alibaba continued its investment spree on Thursday, announcing a 1-billion-yuan ($160 million, 150.9 million euros) joint venture with Chinese automaker SAIC Motor to develop the Internet-connected vehicles - one of the hottest sectors of the car market.

Their first smart-car could hit roads as soon as next year as the 50-50 partnership sets out to "lead China's Internet car development," SAIC Motor said in a statement on its official microblog.

SAIC shares soared nearly 10 percent to a more than two-month high on the news, but closed the day up 4.8 percent.

Alibaba said the future fleet would draw on the Internet titan's technologies - such as cloud computing, maps, communications and digital entertainment - to provide a better driving experience.

Driverless cars

The venture is the latest in an ambitious race to shake up the traditional auto industry as several online companies have teamed up with carmakers to develop a new generation of self-driving and Internet-connected vehicles.

Earlier this week, the CEO Robin Li of China's leading search-engine and Alibaba rival, Baidu, said he may introduce an autonomous vehicle this year. However, he stopped short of naming the automotive manufacturers, though Baidu is already working closely with Germany luxury car brand BMW.

In the US, Google is in talks with some of the world's biggest auto companies, including General Motors, Ford and Toyota, to roll out road-ready self-driving cars by 2020.

Alibaba eyes Snapchat

Alibaba's drive to make inroads into the auto industry comes amid rumors that CEO Jack Ma is also planning a foray into the hotly contested mobile messaging market, with a $200-million (188.5 million euros) investment in Snapchat - an app that allows users to send vanishing photos and is currently banned in China.

The deal would give Snapchat a $15 billion valuation, making the company one of the highest-ranking the startups worldwide.

It is not exactly clear how Snapchat would benefit Ma's e-commerce empire, but the CEO has been aggressively targeting companies that could help Alibaba boost its mobile presence.

pad/uhe (AFP, dpa, Reuters)