Hesai’s Global Expansion Amidst EV Tariffs

Hesai’s Global Expansion Amidst EV Tariffs

Hesai Group, the world’s largest manufacturer of lidar sensors for autonomous vehicles, remains optimistic about expanding into international markets, including Europe, despite ongoing tensions over tariffs on Chinese-made electric vehicles. The company is evaluating investment opportunities outside mainland China to make its lidar sensors more accessible to global customers, according to Andrew Fan, Hesai’s chief financial officer.

Innovation and Cost Reduction

Hesai attributes the affordability of its lidar sensors to technological advancements, increased production volume, and efficient cost control. The sensors, which use lasers to measure distances to objects, are expected to gain widespread adoption as smart driving technologies develop. Despite Tesla CEO Elon Musk’s dismissal of lidar technology in 2019, the market has surged since Xpeng produced the first lidar-guided smart vehicle in 2021.

Company Performance

In the third quarter of 2023, Hesai experienced a surge in lidar sensor shipments, with a 220% year-over-year increase. Revenue grew significantly, and despite reporting a net loss, the company expects to turn a profit in the fourth quarter due to its services for European robotaxi businesses.

Market Dominance and Growth Projections

Hesai holds a dominant position in the global robotaxi lidar market, accounting for a 74% share. The company forecasts that the demand for lidar sensors in China will continue to rise, with an estimated 40% of EVs priced above 150,000 yuan expected to be equipped with the technology by 2025.

Tariffs and International Expansion

Despite tariffs on Chinese-made electric vehicles imposed by the US and EU, Chinese EV batteries and smart car technologies remain in high demand globally. Supply chain companies like Suzhou Hazardtex believe that Chinese firms will continue to expand abroad due to their technological and cost advantages.