Setting the right price for LiDAR mass adoption

Waymo CEO John Krafcik got a huge amount of attention for his announcement at North American International Auto Show (NAIAS) that the Alphabet-owned company had cut the cost of LiDAR by 90%. Wow. Of course, he was talking about the original $75,000 (£60,000) price tag for the huge, spinning rooftop LiDAR Google began its autonomous R&D with in 2009.

That makes the price $7,500 – still light years away from an acceptable price point for production vehicles.

Essential for SDR

While a spinning LiDAR was a feature of every autonomous R&D vehicle, manufacturers struggled to find a cheaper workaround, one that did not involve LiDAR but such autonomous systems failed under low-light and bad weather conditions. So, the race was on to make LiDAR cheap enough instead.

“If you are considering high-level autonomy, having a laser is probably a must,” says Alain Dunoyer, head of autonomous car at SBD. The Consumer Electronics Show (CES) 2017 was rife with solid-state LiDAR announcements; proponents say they're sturdier than spinners. The downside of fixed units is that more are required to provide 360-degree coverage, making that cost issue even more important.

Price and date targets

Continental introduced its ‘Hi-Res 3D Flash LIDAR’, technology acquired from ASC last year. Dean McConnell, director of customer programmes for NA for ADAS at Continental, says it's too early to hang a price tag on the units. The target timeframe for production of the LiDAR is 2021, McConnell says. Continental will offer both short-range and long-range versions. “How those sensors get deployed in a vehicle will depend on input from our customers,” he explains.

Quanergy Systems said it will begin production and delivery of its S3 LiDAR system for several markets this year in a partnership with Sensata Technologies. “Our partnership with Sensata is our path to commercialisation in the auto industry,” says its CEO Louay Eldada.

The company suggested a target price of $250 (£199) for the S3 in volume. “I'm not talking unreasonable volume; 100,000 vehicles is volume to us,” Eldada says. That would add up to 400,000 units to be ordered. Eldada says that he's spoken with most automakers at this point to discuss technology and pricing. “The mandate is to be a few hundred bucks initially and have a roadmap to drop below 100 bucks. At that price point, you can have a LiDAR in each corner of the vehicle, completely hidden in the vehicle.” At that price, with four LiDARs, plus installation costs and software, he estimates a supplier could offer a solution that would add just $1,000 to the price of the car.

Dunoyer says getting the cost down to $100 will be very challenging for any supplier. A high-performance LiDAR that can see out to 100 to 150 metres with a large field of view is unlikely to come in initially below $150 to $200, he thinks. Very large volumes will be required to get the cost below the $100 mark.

Velodyne recently opened a factory and is shipping the HDL-64 LiDAR sensor with plans to produce the entire product portfolio and ship 1M LiDAR sensors in 2018. In December 2016, it announced a new design for solid-state LiDAR that could cost $50. When asked about that price point, Mike Jellen, president and COO of Velodyne, says: “We'll enjoy the same volume/cost-reduction curve as everyone else.”

Jellen also notes that competitors tend to fudge their price claims. Having shipped LiDARs for 10 years, he says: “Our current price at our current volume is frequently compared to other people's future prices at high volume. They'll say: 'Look at their price ten years ago compared to our price five years from now.’” That was certainly Waymo's PR strategy at NAIAS.

Pushing through the supply chain

Jellen is certain that by the time automakers are ready to produce and ship autonomous cars, suppliers will have achieved a workable cost for LiDAR sensors. “The industry is still in the stage of software development and use-case definition. They are finishing high-definition maps and deep learning to appropriately identify objects; they're operating the vehicles to debug all the use cases from driving in the real world and dealing with human drivers,” he says. Aside from Waymo, which has claimed it will manufacture a complete software/hardware system, LiDAR suppliers say autonomous systems and their components will be defined by carmakers.

As Continental's McConnell says: “We're open to providing discreet components all the way to a full integration solution. The customers we have vary from needing that full system solution to customers that have a lot of expertise and do a lot of the integration themselves.”

Waymo are likely to hand-craft the LiDARs for the 100 Pacifica minivans it plans to produce in collaboration with Chrysler. For greater volume, Dunoyer thinks it will probably license its designs or call on a third party to manufacture the units down the road. Waymo did not respond to an interview request. Incidentally, Eldada completely discounts Waymo's announcement. He says: “Waymo is not going to sell LiDAR to customers; they're not in the business of selling cars or auto parts. They want to generate excitement in the marketplace and use the platform to evolve their software. Ultimately, they will sell the software and Alphabet will benefit from the availability of the driver [in autonomous mode] who can now be exposed to ads.”

The bottom line, according to Dunoyer, is that there is no bottom line yet. Noting that Audi's A8 will be the first production vehicle to include LiDARs for what Audi calls piloted driving, he says: “There are so many start-ups saying they have the next best thing. We'll have to see what really happens.”


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