On 6th March 2019, Waymo announced its entry in the automotive sensors market with the selling of laser-mapping sensors (LiDAR) to other companies. Waymo uses the same sensors in its driverless vehicles. As Waymo has a strong presence in self-driving cars, the move to foray in the LiDAR market can prove to be an effective business strategy for the company. The new sensor division will compete with Velodyne Lidar Inc, a leading player in the automotive LiDAR market.
MarketsandMarkets™ View Point:
LiDAR, which stands for light detection and ranging, is a technology that can produce highly accurate images of the ground surface and other target objects. Although LiDAR has been used in the market for more than 40 years, its commercial viability has increased in recent years due to advancements in semiconductor technology. The market is principally driven by the rise in demand for vehicle safety, rapid development of semi-autonomous and autonomous vehicles, and growing adoption of ADAS technology by OEMs. Increased demand for autonomous and semi-autonomous vehicles is expected to accelerate the growth of the automotive LiDAR market from 2019 to 2025. The ability of LiDAR to produce high precision images has encouraged companies to adopt this technology for more accuracy. The growing demand for ADAS application in the automotive industry could prove to be a significant growth driver. However, environment constraints pose a challenge for the use of LiDAR. LIDAR manufacturers need to develop LiDAR sensors that comply with the regulatory norms of different countries.
There is intense competition among automotive LiDAR manufacturers with regard to technology, quality, and most significantly, cost. Most varieties of LiDAR applications are complex and therefore very expensive. The high cost of this technology adds to the overall cost of the vehicle. It is thus the key factor restricting the growth of the automotive LiDAR market. However, the cost of LiDAR sensors is expected to decline rapidly due to advancements in semiconductor technology. Lowered cost of technology would help make vehicle safety systems affordable in the automotive sector.
e- Estimated; p- Projected
Source: MarketsandMarkets™ Analysis
Role of LiDAR technologies in the automotive industry
The advent of LiDAR application in the automotive industry has changed the definition of safety and driver assistance features. The automotive sector is focusing on improving vehicle safety and bringing down the number of road accidents with the help of innovative technologies such as Advanced Driver Assistance Systems (ADAS). These systems make use of radar and other technologies to monitor the road conditions and control the speed of the vehicle accordingly. Nowadays, LiDAR sensors are used in conjunction with radar to further enhance vehicle safety at high speeds. As LiDAR sensors use light as a transmission source, the speed of obstacle detection is faster than radar. Other advantages of LiDAR sensors include a longer lifespan, greater accuracy, and reliability. The integration of these sensors with advanced optics techniques allows for a larger coverage area of nearly 200 meters in front of the vehicle. LiDAR systems can be used in cars for pedestrian avoidance, lane change warnings, auto-braking solutions, and adaptive cruise control applications. Several innovations by leading players such as TriLumina Corp (US) and Velodyne LiDAR (US) would help to bring down the cost of the technology.
Competitive scenario among LiDAR providers
Factors such as an increase in disposable income and rising demand for safety and convenience have increased the demand for premium vehicles in developed as well as developing countries. In addition, premium vehicle manufacturers are attracting consumers with new technological improvements and lower emissions. The introduction of advanced technologies such as adaptive cruise control, blind spot detection, parking assistance, and autonomous driving systems has contributed to higher sales of premium vehicles.
The presence of several players has intensified the competition in the global automotive LiDAR market. These players have adopted various strategies to diversify their presence globally and increase their market shares. These strategies include new product development, expansion, supply contracts, collaborations, partnerships, and mergers & acquisitions. The key strategy adopted by major players in the global automotive LiDAR market is new product development followed by supply contracts, joint ventures/collaborations, and partnerships.
LiDAR provides a self-driving vehicle with in-depth surrounding information and precise accuracy. These sensors are now used in several industries such as robotics, security, and agricultural technology. Since the inception of the technology, the size and weight of LIDAR have been key concerns for the automotive industry. The driving environment and high cost of technology have also been key challenges for manufacturers.
It is estimated that more than 80 companies are developing LiDAR for autonomous vehicles. The entry of Waymo would increase the competition in the LiDAR market that is dominated by players such as Velodyne Lidar and TriLumina Corp. In the future, it would be interesting to see what strategies leading players such as Velodyne implement to retain their share in the market.