Volvo Cars plans to make lidar sensors standard equipment in a new generation of its XC90 SUV next year as part of a strategy to deploy more advanced safety and automated driving technology that relies on precise images of the world around the vehicle.

The decision by Volvo Cars to fold lidar sensors into the base price of its vehicle is a bet that customers will pay for the additional capability. It has been called a “watershed moment” by some in the industry.

The Swedish brand, owned by China’s Geely (GEELY.UL) group, is taking a sharply different road from rival Tesla Inc (TSLA.O), which has shunned lidar and radar and is focusing on just cameras and software for its automated driving systems.

Self-driving car sensor startup Luminar Technologies Inc (LAZR.O) will supply Volvo Cars with its Iris lidar and Sentinel software in combination with software from Volvo in the electric XC90 SUV that will be built in South Carolina and go on sale in 2022, the companies said.
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