Velodyne Abandons its San Jose Mega-Factory Project?

Velodyne closes an agreement with Nikon, under which Sendai Nikon Corporation will manufacture LiDARs for Velodyne with plans to start mass production in the second half of 2019. “Mass production of our high-performance lidar sensors is key to advancing Velodyne’s immediate plans to expand sales in North America, Europe, and Asia,” said Marta Hall, President and CBDO, Velodyne Lidar. “For years, Velodyne has been perfecting lidar technology to produce thousands of lidar units for autonomous vehicles (AVs) and advanced driver assistance systems (ADAS). It is our goal to produce lidar in the millions of units with manufacturing partners such as Nikon."

Compare this last statement with a previous Velodyne PR on its Megafactory: "Located in San Jose, CA, the enormous facility not only has enough space for high-volume manufacturing, but also for the precise distance and ranging alignment process for LiDAR sensors as they come off the assembly line. ...more than one million LiDAR sensors [are] expected to be built in the facility in 2018. That high-volume manufacturing will feed the global demand for Velodyne’s solid-state hybrid LiDAR."

Instead of shipping 1M LiDARs in 2018 alone, "Velodyne has shipped a cumulative total of 30,000 lidar sensors" from the start of the company to the end of March 2019.

One of the reasons expanding in Japan is said to be cost: "Working with Nikon, an expert in precision manufacturing, is a major step toward lowering the cost of our lidar products. Nikon is notable for expertly mass-producing cameras while retaining high standards of performance and uncompromising quality. Together, Velodyne and Nikon will apply the same attention to detail and quality to the mass production of lidar. Lidar sensors will retain the highest standards while at the same time achieving a price that will be more affordable for customers around the world,” Marta Hall says. However, Japan is not a cheap manufacturing location these days. It's not clear how production in Japan makes Velodyne LiDAR cheaper.

The companies are said to continue to investigate further areas of a wide-ranging and multifaceted business alliance.

One major part missing from this PR is a fate of Velodyne Mega-Factory in San-Jose. Half a year ago, the company has appointed a new COO with responsibility to introduce even more automation on the site. It looks like these efforts were not successful enough.