Hesai Group’s profit this year is expected to increase 10-fold, as the world’s most valuable producer of laser radars casts its sights on Europe to put its sensors on more self-driving electric vehicles (EVs) to help them navigate. The Shanghai-based company, which sealed a deal to supply Mercedes-Benz with light detection and ranging sensors (lidars), said it was in partnership talks with several global carmakers, which might generate “substantial” business in 2027. “International carmakers, particularly those in Europe, will use Hesai’s products as they see lidar sensors as an important feature in their petrol and electric cars,” the company’s Chief Financial Officer Andrew Fan said. “The supply contracts will eventually bring us a lot of revenue because the production volume of those marques is high.” Hesai is following the path blazed by Chinese EV assemblers – from BYD to Xpeng – as they look overseas to the export market to survive the brutal discount war at home.
Hesai said its advanced ultra-long-range automotive lidar would be used in the next-generation cars of a “leading European” assembler over the next decade, without divulging the brand. Reuters reported that the customer was Mercedes-Benz, the first time that a leading European carmaker picked a Chinese supplier for its worldwide product. “Hesai’s products cannot be ignored by the assemblers due to our advanced technology,” Fan said, without confirming or denying Reuters’ report. “Geopolitical factors have a limited impact on our drive to go global.” Lidars use lasers to measure distances to objects. Smart cars, typically the new generation of EVs and ultra luxury marques, use this data to build highly accurate maps of their surroundings, a key feature in self-driving or assisted driving.
Hesai holds a 37% share of the global market for lidar sensors, counting brands such as Li Auto, and Volvo Cars’ owner Geely as its customers, according to the consultancy Yole Group. China is the world’s largest automotive and EV market with deliveries of pure electric and plug-in hybrid vehicles accounting for about 60% of the global total. “Trade barriers will not slow the rapid expansion of Chinese supply-chain vendors into international markets,” said David Zhang, General Secretary of the International Intelligent Vehicle Engineering Association. “Their technology and production processes can help accelerate the auto sector’s transition into intelligent EVs. They will also consider setting up local production facilities outside China,” he said, as reported by the South China Morning Post.
