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Mercedes-Benz buys stake in lidar maker Luminar and will use its sensors for future autonomous vehicles

Mercedes-Benz has announced that it will integrate Luminar’s lidar sensors into future production vehicles to enable self-driving capabilities.

The German automaker is also taking a stake in the Orlando, Florida-based company, acquiring a total of 1.5 million shares. Based on Luminar’s stock price of $13.45 at market close on Jan. 19, Mercedes-Benz is buying about $20.2 million worth of stock, or less than 1% of the company.

Lidar, a key ingredient in autonomous driving, is a laser sensor that uses near-infrared light to detect the shape of objects. This helps autonomous vehicles “see” other objects on the road, such as cars, pedestrians and cyclists, all without the aid of GPS or a network connection.

Mercedes-Benz says it plans to integrate Luminar lidar sensors into its production vehicles, but there’s still a lot we don’t know. The automaker declined to share a timeline for integrating Luminar’s lidar into its vehicles, which models would get the laser sensor, or what kind of autonomous capabilities it would enable.

Mercedes-Benz said its 2023 model year S-Class and EQS sedans will feature the automaker’s advanced Drive Pilot driver assistance system, which it describes as capable of Level 3 automation. claims to be the first to “achieve internationally valid system approval for conditional automated driving (SAE Level 3) – marking a milestone in automotive development.” The feature will be be available only in Germany, however, and not the United States.

Level 3, as defined by the Society of Automotive Engineers, means driver supervision is not required in a highly controlled environment, such as on some mapped highways. The driver must always be ready to take control at all times, leaving them somewhere in a nebulous zone between advanced Level 2 driver assistance systems, like Tesla’s Autopilot, and fully driverless vehicles from level 4, such as Waymo’s self-driving taxi service in Phoenix, Arizona.

Many companies claim to release Tier 3 capable vehicles in the coming years. Volvo, which is also using Luminar’s lidar in its upcoming electric vehicles, said its Ride Pilot will allow its vehicles to drive on certain highways without any human supervision – although the company only plans to enable the feature in California. ‘once it receives clearance from the State Department of Motor Vehicles.

Most AV companies, including Waymo, Argo, and Cruise, have said they are skipping Tier 3 and working exclusively on Tier 4 technology. The reason for this is that Tier 3 is considered potentially dangerous, given the likelihood that drivers will be confused about when to take control of the vehicle.

There’s also a data-sharing angle to Mercedes’ new partnership with Luminar. Company CEO Austin Russell said the ability to collect data from Mercedes vehicles will ultimately help improve his company’s self-driving vehicle software.

Russell noted that Waymo, the AV company under Alphabet, has one of the largest AV fleets in the world, with hundreds of vehicles operating in suburban Phoenix, Arizona. He said the ultimate goal was to have “hundreds of thousands of vehicles” on the road around the world to collect data on road conditions and traffic, allowing companies like Luminar to launch features autonomous vehicles in a wider range of markets.

“It takes not just hundreds, but hundreds of thousands of vehicles to be able to globally access the data needed, and not just in a specific suburban area,” he said. “Plus, you don’t have to pay the drivers. It’s the people who are already driving the cars that allow him to keep getting better and better and better.”

This is not the first time that a Daimler-owned company has bought shares in Luminar. Daimler Trucks, a division of parent company Mercedes-Benz, has also bought a minority stake in the company in 2020.

Luminar has secured commitments from a number of companies to purchase its lidars. In addition to Mercedes-Benz, the company has agreements with Volvo, Audi, Toyota Research Institute, Intel Mobileye, Airbus and two Chinese companies: SAIC car manufacturer and audiovisual operator Luminar may even have a partnership with Tesla, despite Elon Musk’s vocal derision of lidar as a “crutch” and “fool’s run”.