The Surprising Role of Robotaxis in the US-China Tech Trade War

In the complex world of international trade and national security, some unexpected players have found themselves at the center of the ongoing US-China tech trade war. While military and cybersecurity technologies have long been focal points of concern, the latest industry caught in the crossfire is none other than the niche field of robotaxis. Yes, you read that correctly—self-driving taxis are now entangled in America’s national defense measures against China. The reason behind this seemingly unusual development lies in the shared technology used in robotaxis, driver-assist features in modern cars, and military applications such as submarines, drones, and advanced targeting weaponry. At the heart of this trade war narrative is the Chinese tech company Hesai Group (HSAI), which experienced a rollercoaster ride, from a successful IPO to becoming collateral damage in the ongoing dispute.

The Role of National Security

The Grave Consequences

National security concerns have always been at the forefront when it comes to trade restrictions between the United States and China. The implications of China gaining an advantage in artificial intelligence and quantum technology, particularly in military and cybersecurity applications, are perceived as having potentially grave consequences. As a result, both nations have imposed limitations on the import of certain technologies from their rival.

Robotaxis: An Unexpected Focus

The Unlikely Centerpiece

What may come as a surprise to many is the pivotal role that robotaxis have assumed in the US-China tech trade war. The same technology that powers self-driving taxis and driver-assist features in modern vehicles is also a crucial component in military technologies such as submarines, drones, and advanced targeting systems. This technology, known as Lidar (Light Detection and Ranging), has become a focal point in the trade war between China and America.

Hesai Group: From IPO Success to Collateral Damage

IPO Triumph

Hesai Group (HSAI), a Chinese tech company, made headlines in February of this year when it conducted the most significant IPO on American exchanges since 2021, raising a substantial $190 million. The company’s innovative Lidar technology positioned it as a promising player in the autonomous vehicle sector.

The Trade War Fallout

However, Hesai Group’s fortunes took a sharp turn as it became one of the prime examples of collateral damage in the ongoing US-China tech trade war. Restrictive measures and the looming threat of additional restrictions have caused the company’s stock price to plummet by over 50% since its initial public offering. This dramatic decline underscores the far-reaching implications of the trade war on companies operating in seemingly unrelated industries.

The Lidar Controversy: A Dangerous Weapon or Xenophobic Fearmongering?

Lidar’s Military Implications

The debate surrounding Lidar, a technology primarily known for mapping cities and assisting in autonomous vehicle operations, has taken an unexpected turn as it enters the realm of national security. US officials have raised concerns about the potential military applications of Lidar, arguing that it should be subject to the same scrutiny as other advanced military technologies. Lidar’s versatility for battlefield mapping, autonomous targeting, and surveillance has sparked apprehensions among policymakers.

Lidar, which stands for Light Detection and Ranging, is a remote sensing technology that uses laser light to measure distances and create detailed 3D maps or models of objects and environments. It works by emitting laser pulses and measuring the time it takes for the light to bounce back after hitting the target. By calculating the travel time of the laser pulses, Lidar systems can determine the distance to objects with great precision. Lidar technology typically consists of a laser scanner, a GPS receiver, and an inertial measurement unit (IMU). The laser scanner emits rapid pulses of laser light and captures the reflected light using sensors. The GPS receiver provides the geolocation information, while the IMU measures the orientation and motion of the Lidar system. Lidar is commonly used in various fields such as autonomous vehicles, environmental monitoring, forestry, urban planning, archaeology, and more. In autonomous vehicles, for example, Lidar sensors help create a detailed 3D map of the surroundings to aid in navigation and obstacle detection. In environmental monitoring, Lidar can be employed to measure forest canopy height, monitor atmospheric conditions, or detect changes in land surfaces. Overall, Lidar technology offers a high level of accuracy and detail, making it a valuable tool for mapping, surveying, and understanding the world around us.

A Contested Narrative

While US officials emphasize Lidar’s military significance, those affected by its inclusion in military tech categories contest these claims. The last two US presidential administrations have been particularly keen on restricting China’s access to Lidar technology. David Li, Chief Executive of Hesai, a prominent Lidar technology company, strongly opposes the notion that Lidar poses a national security or privacy threat. Li goes as far as labeling these concerns as “xenophobic fearmongering” and asserts that they are fabrications perpetuated by competitors.

Hesai’s Predicament

The implications of this controversy loom large for Hesai, as nearly 100% of American self-driving car manufacturers rely on their Lidar technology. The inclusion of Lidar in discussions about military tech has raised suspicions that US lawmakers are potentially championing the cause of American Lidar company Ouster. Ouster has taken legal action against Hesai, accusing them of intellectual property theft. The competition between these companies further complicates the debate surrounding Lidar’s military classification.

Blurring the Lines

The controversy surrounding Lidar’s military applications blurs the lines between national security concerns and economic competition. This situation bears resemblance to China’s ban on using chips produced by the American company Micron in their national infrastructure, based on allegations of a “national security risk.” Both governments seem willing to leverage national security claims to gain a competitive edge in emerging markets. If the US continues to push the Lidar issue, it could open opportunities for American Lidar companies to secure a larger market share if Hesai is forced out of the US market.

Bottom-line: In the realm of international trade and national security, the unexpected often takes center stage. The debate over Lidar’s classification and potential military implications highlights the complex intersection of technology, national security, and economic competition. While legitimate national security concerns must be addressed, it is essential to differentiate between genuine threats and economic interests. The outcome of this controversy will not only impact the future of Lidar technology but also set a precedent for how emerging technologies are evaluated in the context of national security and international trade. The role of robotaxis and Lidar technology in the US-China tech trade war serves as a stark reminder of the intricate web of global interdependencies. While the consequences of this trade dispute are still unfolding, it is clear that even niche industries can find themselves entangled in geopolitical tensions. Hesai Group’s journey from IPO success to collateral damage highlights the challenges and uncertainties faced by businesses operating in a rapidly evolving global landscape. As the trade war continues to evolve, the fate of companies like Hesai Group will remain uncertain, subject to the ever-shifting dynamics of international relations and national security concerns.