What the latest self-driving tech merger says about the future of cars

A merger between two suppliers of lidar — a key autonomous vehicle technology — is the latest tremor in the quickly shifting world of self-driving cars.

• The tie-up between former rivals Ouster and Velodyne, announced Monday, comes less than two weeks after Argo.ai, a leading self-driving car startup, said it was shutting down.

The big picture: The race to develop self-driving cars led to a gold rush for lidar makers, many of which went public in the past couple of years.

• However, their valuations have since plummeted as investors grew disillusioned with autonomous vehicle technology.
• Automakers are now largely turning their focus from fully autonomous driving to partially automated driver-assistance technology, which they're already selling.

Yes, but: Even if self-driving cars never go mainstream, there's still plenty of lidar sensor demand for use in driver-assist features, and in other fields of robotics.

How it works: Lidar ("light detection and ranging") sensors use invisible lasers to create highly detailed 3D maps of their surroundings.

• They work alongside other sensors — such as cameras, radar and ultrasonics — to help vehicles "see" their surroundings.

The bottom line: In a changing landscape, Ouster and Velodyne concluded they would be stronger together.