Why is Valeo clinging to LiDAR?

By Junko Yoshida, Ojo & Yoshida Report, in collaboration with Pierrick Boulay from Yole Group – With its lidars designed into L3 vehicles, Valeo hopes to learn how the car will handle automation, and how that affects cabin redesigns in 10 years.

What’s at stake?

Among all sensors designed into modern vehicles, lidars have seen the most upheaval – to a degree unanticipated even by leading lidar companies. There are no assurances even lidar pioneers like Valeo can keep up with the rapidly changing market landscape.

The causes for this volatility, or attributed to dynamism, include technology advancements, the rise and fall of robotaxis, rapid growth in Chinese EVs, a geographical split among OEMs marketing automated vehicles (L2+, L2++ vs L3), and the death of lidar companies who rode the SPAC boom until their investors bailed.

If we follow classic management texts, any one or two of these “change” factors would have convinced most surviving players to reconsider their strategy.

Valeo, however, is sticking to its guns, despite an adverse market environment.

Clément Nouvel, Valeo's LiDAR technical director
Clément Nouvel, Valeo’s LiDAR CTO (Photo: Junko Yoshida)

The French company, an early leader in the passenger-car lidar market, “dropped its market share from 79 percent in 2021 to 24 percent in 2022,” according to Yole Intelligence, “largely due to the emergence of Chinese suppliers.” More external market factors also affect Valeo’s business.

The Ojo-Yoshida Report caught up with Clément Nouvel, CTO at Valeo Lidar, after the Consumer Electronics Show. We asked how his lidar group has managed to stay in the game.

Nouvel acknowledged, “Good question. We had a lot of questioning inside Valeo – asking how to keep our lead while not falling into the same trap as some lidar startups.”

He added, “In fact, being an established key player in such a rapidly changing market is extremely difficult.” Many lidar startups promise what their customers want to hear. Valeo, however, can’t risk its credibility, as a trusted Tier One, explained Nouvel.

Before diving into our conversation with Nouvel, let’s identify key trends in today’s global lidar market.

New market landscape

First, lidar is still a young market. Big trade shows like CES are still hip-deep in startups pitching their latest and greatest technologies, while larger lidar companies have either folded their business or merged with others. 

This has happened because the automotive industry is constantly searching for lidars with better performance at much reduced prices. 

Historically, the typical lidar startup had neither the capital nor stamina to bring its technology to volume production. The special purpose acquisition companies (SPAC) mania proved to be fool’s gold for capital-hungry startups that needed to keep developing technologies but couldn’t deliver on promises to impatient investors.

Second, the shrinking AV market.

Given the spectacular failure of Cruise’s robotaxi business in San Francisco last year, why would a lidar vendor look for salvation from fully autonomous vehicles?

In its CES press conference, Valeo shared a prediction that by 2030, 30 percent of new premium cars will be at levels L3 and L4. Colin Barnden, principal analyst at Semicast Research, found that estimate very optimistic. More to the point, even if it proves accurate, he asked, why would any company be satisfied with equipping only a 30 percent share of new premium cars?

Although some in the tech industry are loath to declare robotaxis DOA, one reality is clear: An initial lidar boom buoyed by high hopes for fully automated vehicles is over…. Full article