Driving Disruption in Auto Dealmaking

The auto industry is driving toward sustainable, long-term change. In this rapidly evolving landscape, OEMs and their suppliers must adapt or perish. With tech innovation and regulatory reform, the pace of evolution has only accelerated.

Technology is the linchpin of the evolving automotive universe. Capital requirements surge as automakers invest in key areas of innovation.

 

Summary

Connected Cars Autonomous vehicles
With Internet of Things connectivity, car software can be updated remotely, maintenance needs can be detected before a problem arises and passengers will always be able to find a parking spot. Tech players and automakers alike have pooled resources to invest in ADAS and self-driving vehicles to improve passenger safety and reduce transportation costs. By 2030, some estimate 1 in 10 vehicles on the road will be autonomous.

Insights for OEMs, Suppliers, Private Equity and Corporate Investors

As capital requirements for tech investments have surged, auto companies and suppliers need to position their companies for tomorrow. M&A consolidation and unexpected alliances have become the norm —as have divestments and carve-outs to streamline offerings:

  • Venture funds drive deal activity
  • Tier 1 suppliers pursue carveouts and divestitures to adapt business models away from combustion engines—and to deploy capital into EV and tech
  • Joint ventures and partnerships between—and among—auto and tech industries allow for investment in and access to technology innovations
  • When feasible despite high multiples, auto tech or EV acquisitions to future-proof supplier business models
  • Distress is accelerating in automotive space following COVID-19, bringing about additional deals

Related Perspectives

While Automotive Supply Chain Headaches Drag On, Buyers & Sellers Prepare for a Busy Year of Dealmaking in 2022

Automakers and suppliers were forced to cope with unique supply chain challenges in 2021, driving significant disruption to production and resulting in levels of inventory at unseen historic lows. These… Read More

Webinar | Automotive Update 2022: Insights from the TMA Detroit Chapter

On January 11, 2022, Sanjeev Varma, Senior Advisor at Lincoln International, joined automotive experts in TMA Detroit’s virtual panel to share insights on the current automotive M&A environment and industry… Read More

Race Toward Electrification: Automotive Players Define Investment Strategy for the Future

In 2020, global electric vehicle (EV) sales rose by 38%, despite a decline of 20% in total car sales around the world during the pandemic. In May 2021, IHS Markit… Read More

Webinar | Supply Chain Challenges in the Automotive Industry: Insights from the ACG Detroit

On May 26, 2021, Sa Li (Lisa), Vice President at Lincoln International, joined supply chain professionals in ACG Detroit’s virtual panel to share perspectives on challenges faced by the automotive… Read More

The Economist | How to Be the Next Tesla

Originally published by The Economist on June 5, 2021. The Economist published a recent article featuring Managing Director Patrick von Herz describing the current automotive market as a “global feeding… Read More

Capital Requirements Drive Seismic Shifts in Auto Competitive Landscape

From the boardrooms of auto original equipment manufacturers (OEMs) and suppliers around the globe, the geographic landscape of the automotive industry is being continuously reshaped. Archnemeses are forming unlikely alliances.… Read More

An Under-the-Hood Look at the Specialty Automotive Chemicals Market

Specialty automotive chemicals cover a wide range of applications, which can be separated between lubricants, adhesives, cleaning and maintenance chemicals and automotive coatings. From an application standpoint, specialty automotive chemicals… Read More

As the Auto Industry Navigates the Pandemic, How Quickly will M&A Rev Up?

The automotive industry is once again showing its resilience as it navigates the impacts of the COVID-19 crisis. Second quarter earnings from the publicly traded automotive supplier set were generally… Read More

Bright Road Ahead for Investors in the Automotive Aftermarket

As Americans keep close tabs on their budgets and have more time on their hands while at home, the thought of personally performing maintenance and repairs, such as changing a… Read More

Webinar | Analyzing Automotive Investment Opportunities in a Volatile Environment

On June 4, 2020, experts in the automotive supply sector from Lincoln International and Conway MacKenzie hosted a panel discussion providing valuable insights regarding the current industry outlook and recovery… Read More

What is the New Normal? A Closer Look at Automotive Demand & Supply Chain Impact

In April, U.S. light vehicle sales fell almost 50% year on year and resulted in a seasonally adjusted annualized rate (SAAR) of just 8.6m – significantly lower than any other… Read More

Consolidation in Automotive Services Set to Accelerate with COVID-19

The COVID-19 pandemic has drastically altered the way people behave and how businesses operate. As part of those changes, society has also altered the way it moves. More specifically, in… Read More

COVID-19 Impact On Auto Industry – How Long Will It Last?

The COVID-19 crisis has already had a profound impact on the global automotive industry. OEMs have shuttered assembly plants throughout North America and Europe and this has resulted in virtually… Read More

Auto Parts E-commerce Continuing to Hit on All Cylinders

Merger and acquisition activity within the auto aftermarket continues to showcase robust growth driven by strong industry fundamentals. The U.S. light vehicles in operation and miles driven continue to increase… Read More

Tying the Knot: Auto Suppliers Should Follow the OEMs’ Example and Partner up to Meet Industry Demands

The automotive industry continues to undergo radical transformation as the impact of electrification, autonomous driving and ride sharing gains pace. To address these new technologies, players in the auto industry—both… Read More

Global Dynamics Drive Hazards and Opportunities in the Auto Industry

As the economy shudders, dipping its toe into the waters of a recession, macroeconomic, regulatory and geopolitical trends have been disrupting the automotive industry, creating headwinds and pockets of opportunity… Read More

Meet Our Senior Team in Automotive & Truck