(March 12): The push to make cars safer and smarter by employing cutting-edge technology is a more powerful force than rising tariffs and growing political uncertainty pose to global trade, according to the heads of two Chinese auto-tech companies.

The shares of lidar maker Hesai Technology Co surged 50% in the US Tuesday after the company said it broke even for the first time in 2024 and had won a “groundbreaking, exclusive design” deal with a top European automaker, which Reuters later reported was Mercedes-Benz AG. Ecarx Holdings Inc, which provides digital cabin equipment like infotainment units and software operating systems, is also confident of winning more customers.

“The bigger picture here is we are truly seeing the democratisation of such products for safety for all automobiles, not only self-driving cars,” Hesai CEO David Li said in an interview with Bloomberg Television on Wednesday. “Globally, that’s close to 100 million vehicles a year.”

Lidar, which stands for light detection and ranging, can act as "eyes" for vehicles equipped with advanced driver assistance systems to help them determine their surroundings. Li compares the technology to “invisible airbags” that improve safety for all cars, not just self-driving vehicles, by being more aware of impending collisions and obstacles than a human driver.

While Li declined to comment on the Mercedes report, he said the company would be open to production outside of China to respond to geopolitical uncertainties. With the US increasing tariffs on Chinese goods and banning smart cars, it’s ultimately US consumers and manufacturers who will lose out on more advanced technology coming from China that can improve safety, Li said.

The lidar provider is currently appealing a US Department of Defence move putting it on a list of Chinese military companies, with Li saying its products are for civilian use and denying any connections to the Chinese military.

Ecarx, which is backed by billionaire Li Shufu — whose global auto empire spans brands such as Sweden’s Volvo Car AB and the maker of London’s iconic black cabs — has been able to leverage the group’s resources to set up operations outside of China, such as an R&D centre in Europe.

That will strengthen the company’s ability to serve global automakers, CEO Shen Ziyu said in a separate interview Wednesday.

After winning a deal to supply smart cockpit solutions to Volkswagen AG last year, the company’s software will be launched in a number of vehicles in Brazil and India.

“After Volkswagen, of course we will be going forward to other European, US and Japanese manufacturers to upgrade their products to be more intelligent,” Shen said.

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