AEVA CEO on $50M LG partnership

Aeva Technologies (AEVA) CEO Soroush Salehian returned to Market On Close to discuss LG Innotek’s $50M partnership with the LiDAR company. “This is a $50 million vote of confidence,” he says, and is excited to create products in new categories.

I previously wrote about AEVA and LiDAR-assisted self-driving here. To briefly recap, LiDAR is a technology similar to radar that uses lasers to create a 3D map a computer can comprehend. It is used in autonomous driving, usually in tandem with cameras, radar, and other types of sensors.

Specifically, Aeva uses frequency modulated continuous wave (FMCW) technology in its LiDAR. The key difference is that while regular LiDAR emits lasers in steady pulses, and then calculate the environment based on the bounce-back (like echolocation), FMCW sends out a continuous laser that changes frequency. Of course, the lasers are off the visible light spectrum for humans. 

The differences in frequency bounce-backs help differentiate the signals and create the map. Salehian says this lets the system measure “both distance and velocity for every pixel in real time,” (TechCrunch) and compares it to “going from black-and-white to color camera.” 

Aeva has put this whole system on a silicon chip, which Salehian says “helps us scale this” technology, and thinks LG will allow them to “mass scale” and lead to “global adoption.”

LG Innotek is an affiliate of the South Korean company LG and manufactures electronic components. Their products include parts for mobile phones, car displays, and smart products. Its $50M investment in Aeva “established the foundation to accelerate the adoption of Aeva’s FMCW-based perception platform into Physical AI,” per the press release. This equates to a 6% equity stake in Aeva.

The pair aim to implement Aeva’s tech in sectors like automotive (which Aeva already has partnerships in), industrial automation, robotics, and consumer devices. “Our vision is for robots of all different kinds, forms and shapes.” Using the same technology but different algorithms, he says robots using Aeva’s LiDAR would be able to see down to the micron.

In the interview with TechCrunch, Salehian said they would focus on the automotive sector first, with LG Innotek acting “as our manufacturing partner.” Aeva previously announced a development program with a “top 10 global passenger OEM” but did not specify the company. 

The investment suggests the potential for consolidation in the burgeoning autonomous technology industry. For example, this partnership could start edging out rival Cyngn (CYN), which focuses on industrial automation. (I previously covered CYN here.)

The idea of consumer devices adopting this technology also has a lot of potentially interesting uses and could create a smartphone refresh cycle to add sensors. Salehian says Aeva’s tech can read biometric data, allowing “health tracking in a private manner” without “having to wear anything” – a potential direct competitor to Apple’s (AAPL) watches and other wearable tech.

However, the market was disappointed by Aeva’s 2Q earnings on Thursday, July 31. The stock is down over 15% today at the time of writing but is still up around 330% since last year and 220% year-to-date. Aeva reported a loss per share of -$0.44 and record revenue of $5.51 million, both of which beat Street expectations. 

They also announced a partnership with Bendix (a commercial vehicle safety tech company) to advance “collision mitigation” for Class 8 trucks and improve safety on North American roads. Class 8 trucks are the heaviest semis, with a Gross Vehicle Weight Rating of over 33,000 pounds.

“Aeva is entering an inflection point,” Salehian said during the earnings release, “where multiple years of investments…is accelerating next-generation capabilities across multiple automation use cases beyond the traditional uses for LiDAR.” 

The automation battle is just getting started. As Aeva and other players pitch their systems, investors should watch this space and determine for themselves which companies will emerge as leaders.

Watch the full interview below: