The listings were the latest in Hong Kong, which is the world's biggest IPO market this year, and come as Beijing looks to champion the autonomous driving sector.

The Chinese firms, which listed in New York last year, are aiming to expand their foothold abroad against rivals including tech giant Baidu.

But their stocks fell about 10 percent each as they began trading on Hong Kong's stock exchange.

On Thursday's trading, Pony.AI, which priced its shares at HK$139 each to raise HK$6.71 billion (US$860 million), plunged 9.28 percent to HK$126.1.

WeRide set its price at HKD$27.10 as it raised HK$2.39 billion, but tanked 9.96 percent to HK$24.40.

Both companies plan to use the proceeds from the listings to develop autonomous driving technology and solutions.

"This is not only a milestone for both companies, but also a significant landmark of accelerated development for the whole self-driving industry," Pony.AI's CEO James Peng said at Thursday's listing ceremony.

According to its prospectus, Pony.AI has recorded continuous losses since 2022, with Peng telling Chinese media that it expected to break even in 2028.

China has rapidly promoted driverless taxis and hopes to further reduce transportation costs by integrating artificial intelligence.

The country's robotaxi services are expected to reach US$70 million by 2025, but will see exponential growth to US$39.4 billion by 2030 and US$183.0 billion by 2035, according to consultancy Frost & Sullivan.

It is projected that robotaxis will make up a substantial proportion of the overall fleet of shared passenger vehicles operating in China by 2035.

This would also establish China as the largest robotaxi services sector, capturing more than half of the global market share.

Listed ride-hailing companies Didi and Caocao have both included autonomous driving services in their future growth plans.

- Regulation push -

However, analysts have expressed concerns about potential safety issues.

Tom Nunlist, associate director for tech and data policy at Trivium China, said the major challenge for the industry in China is how regulations are currently changing.

"The question here is, is China's regulatory system, is China's legal system, is China's insurance system ready for the mass rollout of these products?" he said.

"I think right now the answer is definitely no."

Chinese officials from the Ministry of Industry and Information Technology said the country is planning to accelerate standards development for driver assistance systems and autonomous driving in the following years.

Over-marketing practices and accidents caused by misuse are forcing the officials to "really put tighter bounds on how these systems operate and how they can be deployed", Nunlist told AFP.

Major Chinese cities, including Beijing and Shanghai, have seen the initial development of robotaxis.

But "it's not something that is on the road in mass, like thousands and thousands of (self-driving) vehicles", Nunlist said.

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