BriefCASE: Chinese suppliers gain strong foothold in global lidar market

Making lidar technology more affordable and accessible seems to be a core strategy of the Chinese suppliers. They are strategically reducing costs and elevating system performance and dependability, aiming to democratize lidar technology for broader market penetration. In the mechanical scanning lidar market, Hesai and Huawei together have a share of over 50% with the other half of the global demand majorly served by suppliers such as Seyond (33%), Valeo (11%) and others.

Things get more interesting in the micro-electromechanical systems (MEMS) lidar market, where RoboSense is the largest supplier in the world with around 97% market share in 2023. Hesai Technology also has presence in MEMS lidars with around 3% share, which is expected to grow in the future, according to S&P Global Mobility's analysts. The MEMS lidar market is experiencing rapid growth due to its compact size and lower cost compared with mechanical scanning lidars, making it highly suitable for mass-market automotive applications.

Hesai and RoboSense have reported strong lidar sales in the first quarter of 2024. RoboSense's ADAS lidars sales reached approximately 116,200 units during the quarter, representing a 542% year-over-year increase. As of May, RoboSense established cooperation with 22 global automotive original equipment manufacturers and tier 1 suppliers and obtained design wins for 71 vehicle models, 25 of which are under production and some more will start production this year, according to the company.

Hesai reported ADAS lidar shipments of 52,462 units in the first quarter, representing an increase of 86.1% year over year. The company has recently secured orders from two global automotive OEMs to provide ADAS lidars for their upcoming series production programs. Including the latest deals, Hesai has now secured design wins with four prominent global OEMs. So far, Hesai has secured ADAS design wins with 18 OEMs and tier 1 suppliers globally across 70 vehicle models.

The rise of domestic suppliers in mainland China facilitating development and integration of cost-effective lidar solutions will continue to accelerate the technology's adoption in a wide range of vehicles from mainland Chinese OEMs. This trend will ensure Chinese suppliers will maintain a strong position in the global lidar market even 10 years from now.

And what about the lidar companies that went public via SPACs? Their time to shine is coming. The likes of Luminar, Innoviz and Velodyne are expected to gain market share as we move through the decade and as North American and European markets follow the >L2+ lead of mainland China, driven by evolving regulatory environment and rising consumer demand.

Luminar, which has partnerships with Volvo Cars and Mercedes-Benz, and Innoviz, which is collaborating with BMW and Volkswagen, expect new rules in the United States mandating higher-speed automatic emergency braking (AEB) on all passenger cars to create demand for long-range lidars. Luminar also has Tesla in its customer list. The US automaker was Luminar's largest lidar customer in the first quarter, but it's not clear if the companies have yet entered any long-term agreement. All in all, these companies are making progress, but are not expected to dethrone the Chinese suppliers anytime soon.