Mercedes-Benz Group AG is expanding its supply deal with Luminar Technologies Inc. to install laser sensors that enhance assisted-driving features in more of its vehicles by mid-decade, the companies said Wednesday.
(Bloomberg) — Mercedes-Benz Group AG is expanding its supply deal with Luminar Technologies Inc. to install laser sensors that enhance assisted-driving features in more of its vehicles by mid-decade, the companies said Wednesday.
The expanded supply contract is a “multibillion-dollar” deal, according to the announcement.
“Instead of just one vehicle model, it’s spreading across the lineup,” Luminar Chief Executive Officer Austin Russell said in an interview. “That’s where there’s huge volume.” He didn’t specify how many Mercedes models will have Luminar’s laser sensors, also known as lidar.
Shares of Luminar rose on the news, climbing 19% at 1:36 p.m. in New York. The company’s stock was down 56% over the last year.
Lidar sensors bounce lasers off objects to enable a vehicle to “see” its surroundings, helping vehicles pilot themselves and improving the performance of safety features like automatic emergency braking.
Some automakers are starting to invest in the tech, which is more expensive than other sensors like cameras and radar. Volkswagen AG struck a deal last year with Luminar competitor Innoviz Technologies Ltd. to buy $4 billion worth of sensors and software to enhance driver-assistance features. Mercedes said last year that it planned to use Luminar’s Iris sensor for its next-generation vehicle platform.
The Stuttgart, Germany-based Mercedes said in January it plans to offer partial automated-driving features in the US for its S-Class sedan and electric EQS sedan by the end of 2023. This system, called Level 3, can take the driver out of the loop temporarily and automate driving in dense highway traffic, the company has said.
Read more: Mercedes drivers go hands-free on Germany’s jammed autobahns
Luminar plans to build a factory in Asia to support the order from Mercedes, adding to its manufacturing plant in Monterrey, Mexico. The Orlando, Florida based sensor company, which went public in a $3.4 billion reverse merger in 2020, also has production deals with Volvo Car AB and SAIC Motor Corp., China’s biggest automaker.
Wall Street shortseller Citron Research criticized Luminar earlier this year in a tweet, arguing the company “will not see any meaningful revenue in near future.”
Russell said Luminar would address that criticism during an investor day on Feb. 28.
(Updated with share price in fourth paragraph.)
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