Why Luminar’s CEO is running over fake kids in a Tesla at CES
LAS VEGAS — Luminar Technologies Inc. Chief Executive Austin Russell climbed into the back seat of a Tesla Thursday morning and told the driver to floor it toward a child.
The child was not real, but the eventual collision was. The Tesla Inc.
electric vehicle, equipped with an automatic emergency-braking system, failed to stop in time, striking the child-size dummy exactly as Luminar’s
27-year-old CEO and his engineers had expected. Alongside the Tesla, a vehicle equipped with Luminar’s lidar (light detection and ranging) technology stopped well short of the dummy while traveling at the same rate of speed, roughly 40 miles an hour.
The point Russell was trying to make is that automotive-safety systems that use lidar — sensors that employ high-frequency focused laser beams to process the world in three dimensions, and the technology at the core of his company — are safer than those that don’t. Along with the Tesla, Russell had Ford Motor Co.
Toyota Motor Corp.
and Lexus automobiles available to test alongside a Lexus-manufactured vehicle equipped with Luminar’s system, which stopped safely for the mannequins as well as for smaller objects while performing more advanced maneuvers than the head-on test performed with the Tesla.
With lidar, “you get an extreme level of confidence for what’s ahead because you know and you can measure exactly down to centimeter-level precision what’s there,” Russell said while conducting the demo with a MarketWatch reporter. “Whereas with cameras, it’s just guessing what’s going on ahead. It doesn’t really know how far away the object is or where it is — it’s just guessing.”
The purpose of the test was clear: For his company to succeed and its stock to come out of a tailspin, Russell has to convince automotive manufacturers, most of whom had a presence at the tech show, that they need lidar on the cars they sell to consumers. While the sensors are largely seen as a necessary component for the robotaxis that have started to carry customers in certain cities around the world, manufacturers that design personal automobiles are largely choosing between adding lidar or radar to camera-only systems or going with cameras only for advanced driver-assistance features, and potentially for additional autonomous features in the future, as well.
From 2017: Lidar really only has one rival in the race to be autonomous cars’ eyes
Many investors made big bets on lidar playing a lucrative role in a more autonomous future in recent years, but those investments largely unraveled in 2022. Startups are flailing. Quanergy Systems Inc.
went bankrupt less than a year after going public in a merger with a special-purpose acquisition company, or SPAC, the same path Luminar took to go public. And after Ouster Inc.
and rival Velodyne saw their stocks plummet 80% last year while suing each other, they decided to merge and try to compete together.
Luminar’s shares have followed a similar trajectory, falling 74.2% in the past year and closing at record lows every day this week as Russell attempted to make a splash at CES. Luminar’s market capitalization fell below $1.5 billion for the first time Friday, but the company has retained its “unicorn” status as the now-larger Ouster sinks below a $200 million valuation. Rival Innoviz Technologies Ltd.
has kept its market cap above $500 million, while Cepton Inc.
is under $200 million.
In a CES press conference and in discussions with MarketWatch, Russell presented Luminar as more than just a lidar company like those others. The sensors are largely seen as commodities — Russell described the general view of lidar as “white-box,” or generic, tech. But he is trying to develop an entire ecosystem around his company’s sensors and attempting to brand the company to consumers as well as car manufacturers. Luminar has developed autonomy software called Sentinel and announced the acquisition of Civil Maps to start building three-dimensional maps with the data its sensors will receive once they are installed on consumer vehicles.
To build decent 3-D maps, though, Russell will have to ensure that Luminar lidar is on millions of consumer cars. At CES, he showed off a car from China’s largest manufacturer, SAIC Motor Corp. Ltd.
that had a Luminar lidar package in a roofline module; the car is already being produced, sold and driven in China. In addition, a Volvo EX90 electric SUV at the company’s booth had the same type of module installed just above the windshield, and Russell mentioned a deal with Polestar Automotive
that had previously been confirmed.
For more: Self-Driving Technology Provider Luminar Just Hit a Big Milestone
Russell said that Luminar exceeded its goal of 60% growth for new production vehicle models in 2022, and he put forward a goal at CES of having its lidar in more than a million cars by the second half of this decade. Wall Street has high hopes for his efforts, projecting that sales will nearly triple in 2023. Analysts on average are modeling 2023 revenue of $116.9 million, according to FactSet, while expecting 2022 sales of $42.1 million, with the final quarter still in question until Luminar reports on Feb. 28.
In aiming higher with dedicated software and mapping efforts, though, Russell could be seen as in competition with more well-rounded autonomous-driving-tech companies such as Mobileye Global Inc.
or Nvidia Corp.
Yet Luminar is years behind those companies’ efforts — Mobileye CEO Amnon Shashua ushered in the type of mapping effort that Russell just debuted exactly seven years ago at the same trade show — and also cooperates with those suppliers so that their technology can work together in systems that do end up on consumer vehicles.
For more: Luminar Wins Nvidia Business in Self-Driving Deal
“We don’t compete directly with Tesla or Mobileye or any of those types of companies, and you can do great work with camera-based systems collecting data for a basic assisted-driving system,” Russell insisted. “We’re enabling the capabilities to do exactly the kind of stuff that you’re seeing here, of coming to a safe stop for any kind of difficult scenario — a pedestrian or object or car or tire or whatever it may be — to eliminate collisions and ultimately eradicate it altogether in terms of accidents. That’s just not something that’s possible with the current technology and systems that are there today,” he said.
“Now, if Tesla for example had millions of vehicles with our lidar on [them] that they were fully utilizing, that would be a different story,” he added.
Tesla CEO Elon Musk has regularly insisted that the camera-only system and related software for which he charges consumers thousands of dollars and brands as “full self-driving” will be capable of full robotaxi service, and he has specifically denigrated lidar. The industry writ large believes Musk’s insistence that camera-only robotaxi-level autonomy is close to fruition to be a fairy tale, with true autonomy requiring many more systems to reach the safety levels required for such services. Tesla did not respond to a request for comment on this article.
Opinion: It’s time for Elon Musk to start telling the truth about autonomous driving
While Tesla’s full self-driving software was not turned on for the demo MarketWatch received — Luminar was focusing on the automatic emergency-braking system, since that system is standard across the cars tested — a Luminar spokeswoman said that the company has tested Tesla cars with full self-driving software turned on and seen the same results.
“Even with this $15,000 package that you have on a car, it can’t even come to a safe stop for the most basic, straightforward use case, like seeing a pedestrian right in front of you,” Russell insisted.
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