Luminar buys one of its chip suppliers to bolster self-driving car sensor

Luminar Technologies Inc, a maker of lidar sensors for self-driving cars, said on Monday that it has acquired a small chipmaker that makes a key part of its sensor.

Palo Alto, California-based Luminar said it has agreed to purchase Wilmington, Massachusetts-based OptoGration Inc, with the deal expected to close in the third quarter. Luminar did not disclose the terms of the deal but said it would not have material impact on Luminar’s cash position or share count.

Luminar’s lidar sensors beam out laser light and detect how it bounces back to help self-driving vehicles gain a three-dimensional view of the road.

The company is one of a half dozen firms that have either become publicly traded in the past year or are in the process of doing so, with all of them vying for lidar deals with automakers. Luminar has a deal with Volvo Cars to start putting its sensors on the roads in driver-assistance systems next year.

Luminar’s device uses a laser that operates at a wavelength of 1,550-nanometers, which it has said gives it the ability to detect objects further than most other lidars that use a 905-nanometer wavelength laser.

The drawback is materials costs, which automakers want to see fall in order to keep prices for self-driving features reasonable. The higher frequency laser requires a detector made of an exotic material called indium gallium arsenide.

For the past five years, Luminar has worked with OptoGration to secure a custom laser light detector that keeps the volume of pricey materials to a mininum. Jason Eichenholz, co-founder and chief technology officer for Luminar, said the company will be acquiring OptoGration’s team and factory, which has the ability to produce 1 million detectors per year and can scale up to 10 million.