LiDAR Industry Hits Impasse: Was Elon Musk Right After All?
At this spring’s Tesla Autonomy Investor Day event, Elon Musk once again dissed the “fools” relying on LiDAR for self-driving vehicle development — prompting the hashtag “LiDAR” to trend globally on Twitter.
Computer vision and hardware engineers and researchers are familiar with the hackneyed LiDAR debate. Although Light Detection and Ranging has proven its reliability and accurate ranging capabilities, the hardware’s size and cost of some US$10,000 per unit are huge obstacles to its mass commercialization.
The technical question is whether to wait 10 or more years for computer vision research to solve the ranging problem or for cheap LiDARs to hit the market. However, since the business mindset is to focus on short-term feasible technologies, the lack of serious buyers is the real problem for the LiDAR industry.
Defending Doubts from Buyers and Partners
A number of startups launched solid-state LiDARs in 2016–2017, optimistic that unit prices would drop to hundreds of dollars with mass production. Finding bulk buyers to drive demand has however been difficult.
In order to survive, LiDAR companies need to either secure orders from L4 autopilot teams or integrate with auto manufacturers’ supply chains. The L4 research teams can only support a few LiDAR makers, while most traditional auto makers have yet to embrace the tech — a notable exception being the Audi A8’s use of the discreet Valeo SCALA.
Top tier auto parts suppliers such as Bosch, Aptiv, ZFAuto part manufacturers have not exactly embraced the commercialization of L3/L4 self-driving tech such as pricey LiDARs. At the Shanghai Auto Show this April a Bosch rep explained, “Probably by 2020, we will have more than 40 models installing L2 systems, but L3, not in the near future.”
Small autonomous driving startups, who used to partner with LiDAR companies at auto shows, are resetting their agendas. Some are using pre-equipped vehicles or testing other tech products, while many have left the industry altogether. A startup rep told us “car manufacturers are considering many promising sensors for mass production targeting the year 2021… unfortunately, LiDAR is not on the list.”
LiDAR manufacturers have not given up — one developer told Synced that “people who believe in pure computer vision are fools… I’m certain that by 2021 LiDAR can enter mass production because the only barrier now is regulations. After that’s solved, LiDARs will be equipped on green-energy or high-end cars, which will reduce the fraction cost, since retail price of these cars is US$40,000 and above.”
Companies and Their Over-Marketing Problems
As the academic and industry debates continue, one LiDAR poster child is being criticized for over-marketing.
Founded in 2012, LiDAR unicorn Quanergy has completed five rounds of financing totaling more than US$100 million for its solid-state LiDARs. In 2018 however Bloomberg published a feature story, How a Billion-Dollar Autonomous Vehicle Startup Lost Its Way, detailing Quanergy’s technical stasis.
For example, although the startup strove to produce LiDAR products on a strict schedule, some insiders claim the products were not as good as advertised, and that no solid-state equipment meeting Quanergy requirements has yet come off the company’s assembly line.
In addition, the mechanical LiDAR prototype M8, introduced in 2016, was roundly returned by customers. Meanwhile, Quanergy has begun to shift its tech focus away from LiDAR, with plans for example to help develop President Donald Trump’s digital Mexican border wall.
Quanergy is not the only company running into problems. An engineer working on L4 autopilot technology told Synced “testing early products of global LiDAR companies reveals big differences between advertised accuracy, vulnerability, product life, and detection range and the real world performance of the products.”
It was an open secret a couple of years ago that many solid-state LiDAR products at high-profile launch events were actually usable, and only mounted atop cars for show.
Only a Few Companies Will Survive the Winter
The year 2013 saw breakthroughs for LiDAR companies. Quanergy Systems, favoured by the capital market for several years, completed its seed round financing; TriLumina, which provides lighting solutions for the industrial sector, reached out to the automotive field; and close to a hundred companies crammed into the promising market subsection.
By 2019 however market activity had subsided. Now, investors are putting their money into just a few companies. Innoviz, Ouster, and Luminar are among those who have pocketed tens to hundreds of millions in financing rounds.
Moving forward, it is natural that only those LiDAR companies that can garner buyer support will survive. And what will become of the others? “We are not talking about accelerating mergers and acquisitions, but companies dying in this field,” an industry insider tells Synced. “It’s not that the big guys are necessarily better, it’s just that the others are all gone.”
Source: Synced China
Localization: Meghan Han | Editor: Michael Sarazen | Producer: Chain Zhang
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