The News: Luminar acquired Freedom Photonics, a high-performance laser chip manufacturer. The deal follows successful multi-year collaboration between the companies and brings next-gen laser chip technology, IP, and production in-house. Read the full Press Release here.
Luminar Acquires Freedom Photonics
Analyst Take: Luminar continues to push the envelope in the autonomous driving space. This time through an acquisition that will further diversify the offering and development of future capabilities. I believe this is a smart move for Luminar as the company looks to improve their LiDAR performance and accuracy — a critical piece for autonomous driving technology — while also driving toward lower cost, which has sometimes been a notable objection to LiDAR.
To get a little more granular on the acquisition. Bringing in the IP of Freedom Photonics will enable Luminar to even better address one of the major problems facing autonomous driving technology — identifying objects at a distance. Luminar already demonstrates this capability, but further innovation to better this capability is going to be paramount to its long-term success. AV systems need to be able to clearly discern between a person or an object in the road, just like a human driver would—and arguably better. This requires a high-powered laser pulse and high-quality beams — two pieces of technology that Freedom Photonics excels at, according to Luminar.
With this acquisition, Luminar completes its goal of acquiring the materials for the three key LiDAR hardware components. Luminar previously acquired Black Forest Engineers in 2017 and Optogration in 2021 to bring the manufacturing of signal processing chips and reception chips in-house. With all three components now being processed in-house, Luminar will be able to better control supply chain costs for lidar production — currently one of the most expensive pieces of ADAS. It’s Luminar’s ultimate goal to lower the cost of production altogether making ADAS a part of more vehicles an actual reality—the company has made significant strides in this area, but more price efficiency will likely expedite LiDAR adoption.
Continuing Luminar’s Growth
As I said, this acquisition is a sound investment for Luminar, a fast-growing provider of LiDAR and a consistent disrupter in the automotive space. With deals in the past year with Volvo and Mercedes Benz, Luminar has become an increasingly visible player in the space, however, the competition is also growing with the likes of NVIDIA, Qualcomm, and Intel all continuing to invest (Luminar partners with Mobileye). They have consistently looked to lower production costs of LiDAR and improve democratization of autonomous driving technology. This deal will be a meaningful step forward in their desire to make LiDAR more attractive to OEMs, and ultimately more available to consumers that seek the safest on-the-road experience in the next generation of vehicles.
Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Other insights from Futurum Research:
Luminar and Mercedes-Benz Team Up to Advance Development of Automated Driving Technology
Making Markets EP16: Driving Toward the Future with Luminar CEO Austin Russell
IAA Mobility 2021: Luminar and Intel Mobileye Partner on Robotaxi Service
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Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
