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Shares of autonomous driving tech company Luminar surge on Mercedes-Benz deal

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Austin Russell, Luminar founder and CEO, with Markus Schäfer, Mercedes-Benz AG chief technology officer at Mercedes-Benz’ Sindelfingen, Germany plant.

Mercedes-Benz

Mercedes-Benz announced Thursday that it will use lidar technology. LuminarIn its next generation of cars, the company’s shares soared 13% in Thursday morning trading.

German automaker BMW is set to purchase up to 1.5million shares of Luminar as part of this agreement. This will be contingent on the achievement of milestones. Both companies agreed to exchange data.

Luminar plans to begin serial production later in the year of its lidar tech. Although Mercedes-Benz declined to specify when it plans to use the lidar technology within its cars, Austin Russell, founder of Luminar, said that this would happen in “the not too distant” future.

Austin Russell, founder and CEO of Luminar discusses the Iris lidar technology that allows it to see its surrounding. These objects will be displayed on the screen in bright lines, which indicate their distance from the vehicle.

Michael Wayland / CNBC

During an interview online from Germany, he stated that “It is a big deal for Luminar.” It’s a significant OEM announcement, and it is a big commercial win for us.

Announcement of Luminar for last year Volvo would be the first automakerLuminar’s lidar tech will be included as standard in a brand new electric SUV, which is expected to debut this year. Russell described the Mercedes-Benz agreement as similar in many aspects to the Volvo-Luminar deal.

The light detection and range system Lidars (or light detection and tracking systems) detects the surroundings to help cars avoid hazards. These systems use light to produce high-resolution images, which provide more detail than radar or cameras.

Wednesday’s close of trading at Luminar stock was $13.45 per share. This is 6.7% less than the closing price. Luminar’s shares were 19% lower this month after it went public via a SPAC transaction in December 2020. The market capitalization of Luminar is $4.9 million.

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