Acquires Strobe, a Lidar Technology Start-Up
Fully autonomous driving is still several years away. It will take time for all the necessary ingredients to be properly aligned. In addition to robust connectivity and regulatory approvals, automakers need enabling technologies more akin to silicon than steel. This has been driving vertical integration, with car manufacturers buying relevant tech companies to quickly integrate the required patents, technologies and talent into their companies and products.
In this vein, General Motors, the largest car-maker in the US, announced last week that it has acquired Strobe, a start-up specialising in lidar technology. Lidar, which means “light detection and ranging”, is one of the main sensor technologies used in self-driving vehicles.
Strobe will be integrated into Cruise Automation, a fully owned unit of General Motors that develops driverless technology. To date, Lidar has been a complex and expensive feature to implement, but the acquisition should enable General Motors to dramatically cut the costs and boost the performance of laser-based vision technology. Sensors developed by Strobe have advantages over other lidar solutions on the market, as they are smaller and cost significantly less.
Self-driving cars need artificial intelligence and cutting-edge computing power to understand road conditions and surroundings, and they also need to see. Cameras and radar have become standard equipment on many new vehicles to alert drivers of hazards, but lidar’s ability to see in virtually all lighting and weather conditions and at long range makes it a vital component for autonomous cars. This is in parallel with technologies such as cellular vehicle-to-everything and dedicated short-range communications, which enable cars to connect to other vehicles and infrastructure. We believe this is a crucial supporting technology beyond sensor fusion to realise the vision for level 5 of autonomous driving (see A Big Step toward Fully Connected Cars).
General Motors is in a race along with most car-makers such as Ford, Tesla and Toyota. But it’s not just the auto sector that’s eager to take a lead in self-driving vehicles. There’s now cross-industry competition, with companies such as Uber and Alphabet’s Waymo unit diligently working to have commercial solutions available. Being first to market will certainly have the benefit of bragging rights, but also the potential of significant long-term revenue streams from licensing intellectual property rights.
We believe the acquisition of Strobe is a wise move by General Motors and it’s likely that there were other companies interested in the start-up. The prohibitive cost of lidar sensors has been one of the bottlenecks for producing autonomous vehicles at scale. Adding Strobe to its self-driving programme will allow General Motors to accelerate its efforts to build and test electric cars with self-driving capabilities. In theory, this will lead to safer and more environmentally friendly transportation. This is a long-term play for General Motors and the industry as a whole.
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