In a significant reversal of its safety strategy, Swedish automaker Volvo has decided to remove LiDAR technology from its upcoming electric vehicles in Australia, marking a dramatic shift from its previous position that the sensor was crucial for improved vehicle safety.
The End of the LiDAR Partnership
Volvo Cars USA confirmed the termination of its relationship with supplier Luminar Technologies, citing the company's failure to meet contractual obligations. This decision directly impacts the Volvo EX90 electric SUV, introduced in Australia in 2024, and the forthcoming ES90 electric liftback, due in local showrooms early next year.
Both models were originally announced with an advanced sensor suite including eight cameras, five radars, sixteen ultrasonic sensors, and a prominent LiDAR sensor housed in a distinctive "bubble" on the roofline. This system was designed to create a 360-degree real-time view of the vehicle's surroundings, with LiDAR capable of detecting pedestrians up to 250 metres away and objects as small as a tyre on a black road from 120 metres.
From Standard Equipment to Complete Removal
The journey with LiDAR has been turbulent for Volvo. Initially standard equipment, the technology was made optional earlier this year, prompting Luminar Technologies – in which Volvo holds a stake – to file a lawsuit against the automaker last month.
Volvo Australia has confirmed that existing stocks of LiDAR-equipped cars, including approximately 30-40 ES90 models, will be the last to feature the technology. All ongoing factory orders from 2026 onward will not include LiDAR, and the vehicles will lose their characteristic roof bubbles.
This move follows revelations in August this year when Volvo Australia clarified to West Wheels that despite being physically fitted to vehicles, LiDAR was not currently being used by or integrated into any active safety systems in any market. The equipment was solely being used for data collection purposes.
Safety Implications and Supplier Uncertainty
The removal of LiDAR raises questions about Volvo's safety ambitions. The company had previously stated that LiDAR would help reduce severe crashes by 20 per cent, while Luminar Technologies claimed the technology could save up to one million lives annually worldwide.
Volvo insists that removing LiDAR will not reduce vehicle safety levels, though it hasn't detailed the specific impact on safety functions. The EX90 recently achieved a five-star safety rating from Euro NCAP, with the same rating expected for Australian versions through ANCAP's data-sharing arrangement.
The decision comes amid significant uncertainty about Luminar's future. In a regulatory filing with the US Securities and Exchange Commission on October 30, 2025, Luminar disclosed "substantial doubt exists about the company's ability to continue as a going concern." This financial instability likely contributed to Volvo's decision to limit its supply-chain risk exposure by cancelling their five-year contract.
Despite this setback for Volvo, Luminar maintains partnerships with other automotive giants including Mercedes-Benz and Daimler Truck AG, as well as technology companies Nvidia and Intel Mobileye, continuing to promote LiDAR as technology that will usher in a "new era of safety."
