With a goal of having self-driving cars on Chinese roads by 2020, Luminar is looking to capitalize on the country’s massive market. China already has more registered vehicles than any other country and is forecasted to account for 40% of global car sales by 2030.
According to Luminar CEO Austin Russell, this week at Auto Shanghai, one of the world’s largest auto trade fairs, more than one million Luminar-equipped cars will be on China’s roads by the year 2028. This massive increase in Luminar-equipped cars signals China’s growing commitment to becoming a leader in automotive technology and innovation. Not only will this advancement benefit Chinese drivers and consumers, but it also represents an important step forward for global Automotive industry integration.
The increased investment in the auto sector between the US and China could be interpreted in a number of ways. Firstly, it could symbolize the two countries’ ongoing efforts to strengthen economic ties despite their growing disagreements over international issues. Secondly, it might suggest that foreign investors are confident in the long-term growth prospects of both countries’ automakers. Lastly, it might simply be a response to consumer demand in China, which remains strong despite some recent changes to policy.
In 2006, when Tesla was just starting up, the company moved its operations from the US to China in order to take advantage of the country’s massive population and growing automotive market. Even though Tesla has faced some challenges in recent years, including an antitrust investigation in Europe and a slowdown in China’s sales cycle, it is still one of the most important foreign automakers and suppliers operating in China.
At first glance, it might seem that the Chinese citizens are more willing to pay for features like automated driving than their Western counterparts. However, this is not entirely accurate. While the Chinese consumers are interested in buying these features, they are not willing to pay top dollar for them. This is likely due to the high prices of automated driving technology compared to other countries. Additionally, many of China’s large state-owned carmakers are still trying to catch up to their foreign counterparts in terms of automation technology. Thus, they have had a hard time convincing Chinese consumers that paying extra for automation features is worth it.
Luminar is expanding its production capabilities in Asia, in anticipation of a surge in demand for its products. The company has teamed up with TPK, a supplier to Apple and Tesla, to build an additional factory that will help meet the growing demand for Luminar’s products. This move shows just how serious Luminar is about gaining a foothold in Asia’s marketplaces and cementing its place as one of the leading light projection manufacturers in the world.
Assuming the new TPK factory meets expectations, it could be a major player in the burgeoning lidar market. Mercedes Benz has already signed a “multibillion” deal to use Luminar lidars in its next-gen vehicles, and other large clients such as BMW and Ford are expected to follow suit. With 600,000 units per year capacity, the new TPK factory could quickly become a leading supplier of this vital technology.
In the near future, Luminar vehicles will have a more expansive global presence as the company gears up to fulfill orders from not just Europeans and North Americans, but Asians as well. China is likely going to play a big role in this expansion, given that the majority of Luminar’s products are destined for that market. This new Asian manufacturing hub may be just what some buyers needs to jump on board and make their dream car a reality.
Volvo’s all-electric SUV EX90 Excellence will be the first vehicle marketed in China with Luminar’s lidars. The SUV is said to have achieved world Premiere at Auto Shanghai, and will come standard with the company’s latest lidar technology. While still in its early stages of development, Luminar’s lidars are said to offer smooth, continuous scanning that allows for safer, more efficient driving due to their increased accuracy and coverage.
Luminar is excited to announce that it has entered into a partnership with Mobvoi, one of the largest Chinese technology conglomerates, to empower developers in China with the latest AI and AR technologies. This partnership will allow Luminar’s software to be integrated into Mobvoi’s portfolio of consumer electronics products, including smartphones
TPK’s investment in Luminar is an indication of the increasing importance that lidars are receiving in the automotive industry. TPK believes that Luminar has a lot of potential and plans to buy shares to reflect this belief. The stock has lost over 80% of its value since peaking at $37, but TPK sees a lot of potential for the company and believes that it will soon be able to recoup its losses.
Luminar faces stiff competition in China from domestic rivals Hesai, Robosense, and Livox. Hesai, which just went public in the United States, has secured a long-term partnership with Chinese robotaxi upstart DeepRoute. Robosense, which has secured a long-term partnership with Chinese drone giant DJI, is expected to challenge Luminar’s dominance in the market. Meanwhile, Livox – the low-key lidar maker that came out of the drone giant DJI – is expected to make significant headway in the Chinese market over the coming years.
