Chinese electric vehicle maker Nio Inc. NIO was among the backers in lidar company Innovusion’s latest $64 million funding round, Reuters reported Monday.

What Happened: Innovusion’s latest funding round was led by Singapore state investor Temasek and also saw participation from venture capital firm Joy Capital. Nio Capital, Nio's investment arm, was among the existing investors that participated in the funding round, as per the report.

California-based Innovusion said it would use the funding to ramp up production to supply Lidar sensors to Nio’s ET7 sedan, which is scheduled to start deliveries in early 2022.

Innovusion's sensors can spot some objects at a range of up to 500 meters and can register all but the darkest objects at a range of 250 meters, according to Reuters.

See Also: Warren Buffett-Backed BYD Outdoes Nio, Xpeng, Li Auto In April EV Deliveries

Why It Matters: Lidar is a remote sensing technology that measures distances using laser light and is seeing increased interest from automakers. A majority of self-driving cars use Lidar as the primary vehicle sensor, while Tesla Inc. TSLA is making progress on autonomous vehicles with its camera-only approach.

See also: How to Buy Nio Stock

Nio unveiled the ET7, its fourth mass-produced model, in January this year. The ET7's Navigate On Pilot comes with NAD, or Nio Autonomous Driving, featuring the Aquila Nio Super Sensing System with ultra-long-range, high-resolution LiDAR.

Nio has previously indicated that pre-order numbers for the ET7 have been higher than what it received for any of its previous models.

In April, Chinese electric vehicle maker and Nio rival Xpeng Inc. XPEV unveiled the P5 sedan, which it claims will be the world's first production smart EV equipped with automotive-grade LiDAR technology.

Price Action: Nio shares closed almost 7.1% lower in Monday’s regular trading session at $34.33.

Read Next: Nio's Battery Swaps Dampen Global Ambitions: Ark Invest Analyst

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