LiDAR is the product of combining lasers with radar technology. In layman's terms, lasers are emitted instead of radio waves, and their reflections are detected and recorded in a point cloud, a "map" of actual X, Y, and Z points in a 3D model, rather than a rough blob as radar would provide. Many fields that require distance detection, such as robotics, unmanned driving, and terrain exploration, can widely use the perception of surrounding objects by launching and receiving lasers multiple times. Such as robots, unmanned driving, and terrain exploration. In 2021, many car companies stated that their new cars would be equipped with LiDAR for the first time, triggering a new era in the LiDAR industry.

Huawei's "car building" has set off an upsurge in driverless driving. LiDAR is the core component.

Although Huawei said it would not build cars, in April 2021, at the 18th Huawei Global Analyst Conference, Xu Zhijun, the rotating chairman, said that he would work with BAIC, Changan, and GAC to create three sub-brands. The first car to be launched is ARCFOX Alpha S, developed in cooperation with BAIC.

Foresight believes that the biggest highlight of Huawei's participation in "car building" is unmanned driving technology, which requires immense data accumulation, advanced algorithms, and outstanding hardware support. LiDAR relies on its ultra-wide radiation area and low power consumption. It will play an increasingly important role in the future development stage of unmanned driving.

In addition to the ARCFOX Alpha-S car released by Huawei, several manufacturers have indicated that the new models will also be equipped with LiDAR.

In recent years, the rapid development of lidar technology has entered a new stage in 2019. In this stage of development, 

The early LiDAR industry is mainly used for geological prospecting due to its ability to penetrate ground vegetation, with significant R&D investment and low profitability.

From 2016 to 2019, as new energy vehicles entered the public eye, the development of LiDAR gradually accelerated while domestic and foreign start-ups poured into the market one after another. During the commercial pilot, some driverless cars were equipped with lidar.

In 2019, LiDAR entered a new stage of development. The development of chip technology and 5G has made the internal core modules of lidar more intelligent, networked, fast, and electrified. LiDAR has begun to appear in the performance and price stratification trend.

The price of LiDAR will continue to drop.

LiDARs are mainly divided into mechanical, semi-solid, and solid-state categories. There are significant differences in the price of lidars of different qualities. Among them, the price of vehicle-mounted semi-solid and solid-state lidars is less than 1,000 US dollars, while the price of some high-end mechanical lidars reached 80,000 US dollars in 2018.

Wang Jun, president of Huawei's smart car solutions BU, once said that Huawei plans to reduce the cost of lidar to US$200, or even to US$100. It can be seen that with the rapid increase in the volume of lidar in the future and the increasing competition of enterprises, its price will show a downward trend in short to medium term.

Chart-2 Global Lidar represents the manufacturer's radar price(Unit: USD)

There are many development directions for domestic lidar companies.

areAt present, most of the global lidar companies are listed in the United States. Although the number of domestic-related companies is small, as a "global automobile manufacturing factory," China will have more related companies seeking to go public in the future. Among domestic and foreign lidar companies, mechanical lidar manufacturers include Velodyne, Hesai, Ouster, etc.; semi-solid types include Robosense, Innoviz, Aeva, and DJI Livox solid-state types include Quanergy, Ibeo, etc.

The market scale of China's LiDAR industry predicts that

autonomous driving is divided into five levels: L1 (simple assistance), L2 (preliminary semi-autonomous driving), L3 (partial autonomous driving in specific environments), L4 (fully respond to general scenarios), and L5 (response to Any scene). The mainstream autonomous driving levels will be L2 and L3 in five years.

Passenger car sales will grow by 5% in the next five years, and the penetration rate at 30%. Assuming that China's passenger car sales in 2021 will reach 23 million units, the penetration rate of L2 and L3 will reach 20%, and the single-vehicle will be equipped with LiDAR for 5000 yuan. The price of single-vehicle LiDAR is decreasing by 15%, while the LiDAR configuration rate of L2 and L3 models from 2021 to 2026 is predicted by 1%, 10%, 25%, 40%, 60%, and 100%. The forward-looking view is that the market scale of China's automotive LiDAR industry will exceed 43 billion yuan in 2026.