China's Hesai to halve lidar prices next year, sees wide adoption in electric cars

Hesai

27/11/2024 06:00

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      Next-generation lidar product to be under $200 next year
    

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      Price drop may make use of lidar appealing for even budget
EVs
    

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      Use of self-developed chips, more output to enable price
cuts  
    

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      Shares up 44% Tuesday after break-even forecast for this
quarter
    

  
       SHANGHAI, Nov 27 (Reuters) - China's Hesai Group
 HSAI.O , the world's largest maker of lidar sensors for
autonomous driving, said it plans to slash the price of its key
product by half next year which should lead to far wider
adoption of the technology in electric cars.
    "We are moving to a stage where millions of cars sold
annually are equipped with lidar," Chief Executive David Li told
Reuters in an interview.
    Halving the price would make the use of lidar appealing even
for cheaper EVs priced below 150,000 yuan ($20,000), he added.
    For electric cars priced above that, the adoption rate for
lidar technology would likely jump to 40%, Li also said. That
compares with a current rate of about 24% for Chinese EVs and
plug-in hybrids, according to auto parts trading platform
Gasgoo.com.
    Lidar uses lasers to produce three-dimensional images of a
vehicle's surroundings which helps vehicles navigate around
obstacles. The sensors are a key component of many self-driving
systems being developed by automakers.
    "We should see this as the popularization of lidar as a
standard safety component for EVs," Li said, likening its use to
that of airbags and safety belts.
    Hesai's next-generation lidar product ATX for advanced
driver assistance systems (ADAS) will be sold next year for
under $200, half the price of the current AT128 model.
    The price cut will be made possible by using self-developed
chips to run lidar sensors and improving factory operation
rates, Li added.
    His comments come after the company reported earnings on
Tuesday when Li said he expected Hesai to break even in the
current quarter following a net loss of 70.4 million yuan ($9.7
million) in the third quarter.
    Shares in Nasdaq-listed Hesai soared 44% on Tuesday after
the results, giving it a market cap of roughly $875 million.
    Encouraged by strong demand from automakers in China, the
10-year-old company plans to more than double output at its
plant in Hangzhou next year to its full annual capacity of 1.5
million units.
    It currently supplies a dozen automakers in China including
Li Auto  2015.HK  and BYD  1211.HK . Its lidar sales more than
tripled in the third quarter to nearly 130,000 units.
    Hesai Chief Financial Officer Andrew Fan said in the same
interview that the company is looking to expand globally and has
been in discussions with foreign automakers.
        Asked how Hesai might counter potential entry barriers
to foreign markets such as the U.S. and Europe due to growing
trade tensions, Li said Hesai was "actively exploring" avenues
to set up plants overseas. 
    "In the long run, the global trend would be for countries
like the United States to encourage us to set up local plants
and create jobs locally," said Li. 
    Lidar technology has notably been shunned by Tesla  TSLA.O ,
which instead relies on cameras and artificial intelligence to
detect hazards around its vehicles.
    ($1 = 7.2506 Chinese yuan)

 (Reporting by Zhang Yan and Brenda Goh; Editing by Miyoung Kim
and Edwina Gibbs)
 ((Zoey.Zhang@thomsonreuters.com;))