Hesai Group Stock Is Soaring Tuesday: What's Driving The Action?

Hesai Group – ADR (NASDAQ:HSAI) shares are trading higher Tuesday after the company secured a multi-year deal with Mercedes-Benz to supply Lidar sensors.

What Happened: Mercedes-Benz is set to develop smart cars equipped with Hesai’s lidar sensors, according to Reuters.

A person with direct knowledge of the matter reportedly said Mercedes had been going back and forth on the decision for months due to legal and geopolitical risks. The report indicates the partnership will mark the first time a foreign automaker has sought to use Chinese-made lidar systems for vehicles sold outside of China.

Mercedes reportedly went with Hesai because of the company’s lower cost and ability to scale. The news comes as trade tensions rise between the U.S. and China.

Related Link: Trump, Xi Discuss Potential ‘Birthday Summit’ Amid Rising Trade Tensions: Report

Hesai on Monday announced an exclusive multi-year contract with a leading European OEM, but did not provide the name of the company.

“This long-term partnership is a resounding endorsement of our unrivaled performance and quality,” said Hesai CEO and co-founder David Li. 

“Meeting the rigorous standards of a market leader, our quality has become our namecard — a powerful symbol of excellence and a vote of confidence in our visionary future. We are immensely proud to empower the future of mobility, with our state-of-the-art lidar technology playing a pivotal role in conventional and electric vehicle platforms.”

As of February, Hesai has earned 120 design wins across 22 automotive OEMs.

HSAI Price Action: Hesai Group shares closed Tuesday up 50.41% at $24.08, according to Benzinga Pro.

Photo: Courtesy of Hesai Group.