Ted Tewksbury, CEO, Velodyne Lidar joined Grayson Brulte on The Road To Autonomy Podcast to discuss Velodyne’s path to profitable LiDAR. 

The conversation begins with Ted discussing why he joined Velodyne now. 

I joined the company for three very simple reasons, first of all, I believe passionately that LiDAR is going to be an enormous market and it’s going to transform virtually every industry as we know it. Second, I believe that Velodyne has the right technologies at the right time to really capitalize on that opportunity. And, thirdly I knew that I had the right set of skills and expertise and grey hair to really help parlay the company’s technologies strengths into revenue growth, profitability and shareholder value. – Ted Tewksbury

In 2021, Velodyne put in place a strong foundation for growth, including new executives and an upgraded Board of Directors. Now that the foundation has been laid, the company’s top priority for 2022 is to accelerate the company’s path to profitability. 

We are doing that by rationalizing our cost structure, while at the same time driving deployments of LiDAR at scale into a wide range of industries. – Ted Tewksbury

Taking a look at the current state of markets, Velodyne is prioritizing the industrial robotics and the intelligent infrastructure markets as the company focuses on generating profitable revenue today. Overlapping this market is the rapid growth of e-commerce fulfillment centers which inherently relay on industrial robots to move goods from the shelfs to the shipping line. 

It’s not just about sensors. At the end of the day, our customers are solving a business level problem, so we offer the full stack solution, software plus sensors. – Ted Tewksbury

Under Ted’s leadership as CEO, the company is taking steps to lower the cost of LiDAR to sub $500 by offshoring manufacturing to Thailand. When the sub $500 LiDAR sensor is achieved, growth will be accelerated, especially in the automotive market. 

The biggest single challenge that faces not only Velodyne, but the entire LiDAR industry is cost. Because the competition is very inexpensive. The competition is radar and camera. – Ted Tewksbury

In order to achieve cost reduction, the company has implemented a platform based design (MLA – Micro Lidar Array) strategy. With the company’s manufacturing occurring in Thailand and the current delay of 111 days for foods shipped from Asian Ports to the United States, Grayson asks Ted how he is managing the business for supply chain delays. 

We’re taking very proactive steps to alleviate bottlenecks. We are not just sitting idly by and waiting for the macro crisis to subside. First of all, we have lined up multiple sources for critical components, which gives us more flexibility. Second, we have redesigned some of our sensors to use more readily available components.

Third, we’re judiciously building inventory on long lead-time components. Under those circumstances, that’s risky, and so we are requiring non-cancelable, non-returnable purchase orders from our customers. – Ted Tewksbury

Behind this strategy is Ted’s goal of Velodyne becoming the world’s first profitable LiDAR company. To achieve this goal, risk has to be managed and this is where the non-cancelable, non-returnable purchase orders strategy into comes into play. Velodyne is showing shrewd business acumen.

Wrapping up the conversation, Ted shares his outlook on the economy. 

Recorded on Monday, June 6, 2022

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