Lidar maker Luminar stated Wednesday that Mercedes-Benz will incorporate its sensors and software program in a “broad vary” of automobiles beginning mid-decade, in a major enlargement of an ongoing partnership between the 2 corporations.

Underneath the expanded deal, Mercedes-Benz will incorporate the following model of Luminar’s Iris lidar into an upcoming partially automated driving system that shall be made accessible on many future Mercedes fashions. Mercedes’ new system will enable expanded hands-free operation throughout freeway driving at speeds as much as 130 kilometers per hour (81 miles per hour), in addition to enhanced driver-assist options in city environments.

Luminar’s shares jumped greater than 25% following the announcement.

“We are actually set to allow the broadest scale deployment of this expertise within the business,” Luminar CEO Austin Russell stated. “Mercedes’ requirements for car security and efficiency are among the many highest within the business, and their choice to double down on Luminar reinforces that dedication.”

The deal builds on one introduced by the 2 corporations in January 2022, during which Mercedes-Benz stated it could incorporate Luminar lidar in upcoming high-end fashions.

“In a primary step, now we have launched a Degree 3 system in our top-line fashions,” stated Markus Schäfer, Mercedes-Benz’s chief expertise officer, referring to final 12 months’s take care of Luminar. “Subsequent, we wish to implement superior automated driving options in a broader scale inside our portfolio.”

Luminar did not disclose the anticipated manufacturing volumes, however the firm did describe it as a “multibillion greenback” enlargement of the sooner deal, and a Luminar spokesperson instructed CNBC that this new deal is “greater than an order of magnitude greater” than final 12 months’s take care of Mercedes-Benz.

Luminar will unveil the next-generation model of its Iris lidar system when it stories its fourth-quarter and full-year outcomes on Tuesday.

—CNBC’s Michael Wayland contributed to this report.