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An industry in a state of flux
The automotive industry has experienced mergers, acquisitions, and divestments throughout its history. Remember the Premier Automotive Group and Daimler Chrysler?
However, recently, there has been a notable trend for consolidation which looks to be more enduring. For example, the new mega automotive conglomerate Stellantis, has seen the combining of the PSA and FCA Groups bring brands such as Fiat, Citroen, Jeep, Opel, and Dodge together, bringing its line-up of brands to 15 in total. The world’s newest car giant is now the fifth largest car maker, just behind the original past master Volkswagen which still holds multiple brands, including SEAT, Audi, and Bentley.
This is certainly not the first time has happened. The need for consolidation is a clear reflection of companies’ desire to gain synergies in vehicles research and production, often sharing platforms and suppliers to reduce costs. Consolidation seems to be the name of the game for longer-term reasons, with companies shaping up to deal with the economic forces as we emerge from the pandemic and ready themselves for environmentally friendly alternatives such as electric vehicles. Of course, with all this change, it is comforting to see old favourites, such as Toyota, Volkswagen, Ford and GM are still marking their territory.
Major trends include:
- The changing face of automotive sales landscape brought about by digitalisation
- Digitalisation and the evolution of the “connected car”
- Electrification
- New market entrants such as Tesla and Chinese EV manufacturers
- The development of zero emissions solutions, including hydrogen and synthetic fuels
- The development of autonomous vehicles
What next?
There is a clear consensus that scale means survival as well as opportunity. Industry experts will no doubt be keeping an eye out for next deals on the horizon. The once distant humming of an electric future for the car industry is not far off and we should expect to see further change and collaboration.
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