Tom Fennimore: Yes, so Natalia, there were 2 contracts in particular that were supposed to get done in Q3. One of them is actually done it got done in October instead of September. The other one is going to be get done here, I would say, in the coming days. And so once again, that’s just revenue that will that will start to recognize in Q4 as opposed to Q3. When you kind of look at where we ended up in Q3 from a revenue perspective and then you look at kind of what the implied Q4 revenue is, it’s about 10 million of additional revenue. Of that $10 million of additional revenue, about 70% of that is, I would say, coming from contracts that we’ve already executed. And so, we feel pretty good about that strong sequential growth from Q3 to Q4 and most of that revenue we’ve kind of already have locked and loaded in contracts that we’ve executed.
Austin Russell: That would be like what I mean over 50% growth from Q3 to Q4.
Tom Fennimore: Yes, I would say 10% over 17%, I think is somewhere around 60% but you know don’t have my calculator with me.
Natalia Winkler: That’s very helpful And then the second question I had was kind of a little bit longer term strategic just wondering, if you guys can provide some more color on the China market, right? Like, what kind of competition are you seeing there? And how do you think, how do you consider those dynamics of Chinese OEMs maybe getting incrementally more successful in Southeast Asia and Europe? Does that basically kind of change your view, your opportunity your view on the opportunity going forward?
Tom Fennimore: Yes, look, we are — the China market, I would say is moving very fast, both in terms of the automakers there adopting LiDAR technology, particularly some of these new EV companies, I would say as well as the pace at which Chinese companies move. And so from a Luminar perspective, one of the things that’s very important to us is to kind of be able to move at that China speed to make sure that we can continue to win in that market. We’ve so far been really the only Western LiDAR company that’s had success in China. And we think that that success is going to continue. But we need to make sure that, we operate in China in the right way, to make sure that we can appropriately serve the local Chinese customers, both in China but as they start to expand globally. That’s why the second manufacturing plant we opened up is in China with TPK. And I think you’re going to continue to see us increase our business in China as well as our presence in China.
Natalia Winkler: And if I may, we’re just one follow-up on this. How do you guy’s think about ASPs longer term, for China market and outside of China market? And also, like, how should we think about the ASPs that you guys are considering for the order, for the order book, the $1 billion?
Tom Fennimore: Whatever’s in the order book is already have, pricing agreed to with our customers. And so that’s kind of already contractually put in place. Look, we’re always going to get pressure from our — from our customers and automakers, whether they’re in China or globally, to lower our prices. But the one thing that we continue to impress upon with our customers is you got look at the value that our LiDAR provides. And that’s both in terms of the unique technology to enable this next generation ADAS system, as well as highway autonomy. We’ll continue to be able to bring our costs down with our next generation LiDAR but really the value we create in the ecosystem is where we like to focus the conversations on. We tend not to compete on business where it’s who can provide the cheapest costs LiDAR. We like to compete on business where who can provide the best value to the system that our customers are trying to build in.
Austin Russell: And I think it’s also very important to note that and again, this is where obviously the foundation of the business has been a lot but we’ve really been focused on how we continue to monetize the ecosystem around this through our software and AI developments that we’ve had and seen some success with through, for example, these mapping products that we’ve now been able to be out the way through all the different parts of the entire supply chain, even all the way down to the semiconductor level, the LiDAR and how we’ve been able to successfully sell those products even just outside of what we do with the core business. So I think that’s important as part of this, ultimately insurance will play a significant role and I think supporting very significant long-term ASPs associated with safety improvements or the safety improvements will ultimately be king, when it comes to the kinds of value proposition that you can be able to provide.
And this is where we are also — and are successfully launching a new test protocol and system. This is actually Swiss Re is going through an independent third-party test. They’re exclusive insurance partner here to be able to quantify the benefits and safety improvements what the LiDAR can have to be able to basically correlate that into respective insurance savings and costs. And I’ve said, multiple occasions before that the respective savings and value that’s being provided from that alone, from a safety savings standpoint, it’s expected to be significantly more than even just the entire cost of the LiDAR in and of itself. So I think this will be certainly on premium vehicles and even mainstream vehicles. So accidents are expensive. Vehicle collisions are expensive.
And even if you average over time and probability weighted, it’s extremely expensive. So preventing that makes a huge difference. And that’s why I think it’s very clear that over the long-term, from a value proposition ASP standpoint, it all comes down to the technology, the product in terms of what can be supported. And that’s why we’re obviously proud to be the leading technology company in that respect and have the performance capabilities for why we’re seeing all this leading adoption from the top automakers out there.
Aileen Smith: Thanks, Natalie [ph]. We’re going to transition back to some questions from our investors. The next one is going to be for Austin. Going by 3-year design cycles, 2024 RFQs will be for the 2027 model year. Will these RFQs be pitched with the next-gen LiDAR?
Austin Russell: Yes. So I would say that, when we’re talking about the second half of the decade here, absolutely that will incorporate our next-generation LiDAR as well. We have Iris and we have Iris+ that are continuing to scale accordingly with automakers as well, so that’s not stopping. But when it comes to the next-generation systems and models, that will ultimately streamline into the respective roadmaps of the customers. For both existing customers and new customers, we’re also making sure that the sensors are, so to say, backwards compatible. As it relates to the respective automakers as well, to make sure that, ultimately, as they launch new models and whatnot, they can have an easy and straightforward transition with both the hardware and software, respectively, to the new sensor technologies that we have.
