China’s growing dominance in the global LiDAR market is a growing national security threat facing the United States from an adversary that already is making incursions into the country’s critical infrastructure, according to nonprofit think tank and lobbying firm.

China President Xi Jinping for several years has promoted technological independence as a key to the country’s economical and national security, with the government pumping money into homegrown science tech companies. Initiatives like Made in China 2025 – launched in 2015 – aimed to drive development in such technologies as AI, semiconductors, and 5G to not only break its dependence on products from companies in the United States and elsewhere but also to grow its market share globally.

LiDAR is one of those markets, according to Foundation for Defense of Democracies (FDD).

“Today, Chinese companies are rapidly consolidating control over the global LiDAR market, with PRC-origin sensors now widely deployed across civilian and military networks worldwide, including in the United States,” FDD Senior Fellows Craig Singleton and Mark Montgomery wrote in a report this week. “These sensors often serve as essential nodes within interconnected public safety, transportation, and utility systems, which is a clear benefit to the United States.”

This poses a national security threats, Singleton and Montgomery wrote, noting parallels with concerns about networking gear from Chinese telecom Huawei, which U.S. organizations and lawmaker have alleged were compromised by the Chinese government and used to spy on U.S. government agencies and companies.

“Chinese LiDAR’s system-wide integration also leaves its users vulnerable to espionage and sabotage, potentially enabling Beijing to access sensitive U.S. data or disrupt critical operations,” they wrote.

Remote Sensing Technology

LiDAR – light detection and ranging – is a remote sensing technology that uses laser pulses to create highly detailed 3D maps of environments. The technology sends out pulses and calculates the time it takes to return to a sensor, pulling in spatial data and creating the maps.

It’s best known for being used in autonomous vehicles but is applied widely in the United States and other countries in such areas as land management, climate monitoring, meteorology, and airport transportation.

Utility companies and critical infrastructure providers are using LiDAR to monitor pipelines, power lines, and railroad networks to identify structural weaknesses and environmental hazards, while city planners are pairing it with AI to develop smart cities, the researchers wrote.

It’s also used by the U.S. military for self-driving vehicles, mapping battlefields, missile guidance systems, reconnaissance, and determining line of sight. Pentagon plans call for even broader use of LiDAR in such areas as autonomous drones and advanced helicopters.

China likewise is expanding its use of LiDAR as it modernizes its military.

Booming Industry

According to Fortune Business Insights analysts, the global LiDAR market will grow from $2.31 billion last year to $7.94 billion by 2030, noting that in 2022, North America had a 33.16% share of the market, the largest in the space.

However, the backing by the Chinese government gives companies in the country an advantage over competitors in places like the United States, Canada, Israel, and Germany, particularly with less-expensive LiDAR devices, FDD’s Singleton and Montgomery wrote.

“As LiDAR adoption grows, China’s market dominance could provide Beijing with strategic leverage across other emerging industries, such as precision agriculture, renewable energy, and advanced robotics,” they wrote, adding that the rapidly widening use of the technology brings with it “significant risks.”

Spying Tool

“The technology’s ability to collect and transmit precise spatial data makes it a prime tool for espionage and sabotage, especially when these systems are manufactured or otherwise controlled by companies located in foreign countries of concern,” the researchers wrote. “These risks are set to intensify as LiDAR systems are increasingly deployed near critical infrastructure, transportation hubs, utility grids, and defense nodes across the United States.”

The risks are multiplying, Singleton and Montgomery warned. As LiDAR systems become more sophisticated and complex, adversaries could develop way to manipulate pulse codes to interfere with the systems and connected network. Backdoors and other malicious code could be allowed and concealed by advanced processors, the use of custom chips made in China can come with hidden vulnerabilities, their reliance on embedded operating systems like Linux and use of Ethernet means they connect to the internet – which increases their vulnerability to attack – and over-the-internet updates make them even more vulnerable.

U.S. Needs to Act

They wrote that U.S. lawmakers need to prioritize the development and use of American-built LiDAR systems through public-private partnerships with U.S. LiDAR manufacturers, utility companies, and automakers. The Commerce Department should ensure that LiDAR systems coming from such adversarial countries as China and Russia should disclose hardware, software, and security features. In addition, the U.S. should ban the use of China-made LiDAR systems for critical infrastructure, enhance security standards for LiDAR systems, and regulate the use of data coming from them.

“As Beijing seeks to expand its influence over LiDAR supply chains, the United States and its allies must implement robust policies to secure their own LiDAR capabilities and protect against foreign exploitation,” they wrote.

Congress is taking steps. The House Select Committee on the Chinese Communist Party in September proposed legislation that would ban the Transportation Department from using LiDAR technology made in the country, a move that came a year after lawmakers asked Biden Administration officials to investigate Chinese LiDAR companies. One such company, Hesai Technology, around that time pushed back at lawmaker concerns, saying that its systems don’t store or wirelessly transmit data.