LiDAR shipments are expected to cross 100 million units by 2030 driven by the automotive industry. The increase in demand for LiDAR will match the increase in demand for ADAS and automated driving in passenger cars and robotaxis. As the number of LiDAR sensors per car increases, reaching a likely maximum of eight units to enable fully autonomous driving, the LiDAR market is expected to grow at a CAGR of 65.9%  to reach $15 billion by 2030.

Level 3 and above automated driving will require a fusion of LiDAR, radar and camera sensors. While a few companies, like Tesla and Wayve, will look to make autonomous driving successful without LiDAR, most car manufacturers, like Mercedes-Benz, Nissan, BMW, Stellantis, Volkswagen and Volvo, have already announced their intention to include LiDAR in their sensor suites for ADAS/AD in upcoming car models.

The biggest threat to LiDAR comes from alternative technologies such as cameras and machine vision. A small number of companies believe that vision-based systems are sufficient to support autonomous driving. This can hamper the growth of LiDAR as the cost of switching to cheaper vision-based solutions is relatively low.

Automotive LiDAR market

The current LiDAR market is crowded as more than 70-80 companies are operating globally, targeting different industries and regions. From 2020 onwards, a total of nine companies – Velodyne, Luminar, Aeva, Ouster, Innoviz, Aeye, Indie Semiconductor, Quanergy and Cepton – have announced listing of stocks through SPAC mergers.

Valeo’s Scala is the world’s first mass-produced LiDAR for cars. In 2021, Mercedes-Benz and Honda introduced Level 3 models S-Class and Legend respectively. Both are equipped with Scala LiDAR. Since 2017, Valeo has shipped more than 170,000 LiDAR units.

According to a Counterpoint study, the value of the automotive LiDAR market reached around $100 million in 2021 as car companies including Toyota, Honda and Chinese companies like Xpeng launched models equipped with LiDAR. Many car OEMs have signed deals with LiDAR suppliers for their upcoming models. Chinese automakers are at the forefront in entering such partnerships.

Future of automotive LiDAR market

According to Counterpoint’s Global Autonomous Passenger Vehicle Forecast, by 2025, 10% of the new cars sold globally will have Level 3 driving capabilities. Developed markets like the US and Europe will have a higher percentage of Level 3 cars and will first see the entry of Level 4 cars (subject to regulatory approval). This suggests LiDAR has a considerable growth opportunity as Level 3 and above cars will reach the mass market in unison by 2030. According to Counterpoint’s Automotive LiDAR Market Trends and Implications, 2022 study, the LiDAR market is expected to grow from $0.1 billion in 2021 to over $15 billion and over 100 million units shipped in 2030.

Conclusion

After the first use of LiDAR in the automotive segment, it took more than five years for LiDAR to make it to a production vehicle and it still has not been successful at achieving broad market penetration. But it is early days and the scope for LiDAR is considerable. We believe that despite the slow initial diffusion, LiDAR adoption will gather pace.

For more insights and analyses on the Automotive LiDAR Market, please refer to Automotive LiDAR Market Trend and Implications, 2022, which captures the current and future LiDAR trends, LiDAR cost, and threats to LiDAR in the automotive industry.