Analysts predict further brand consolidation

Analysts predict further brand consolidation

December 23, 2019 0 By autotimesnews

Consolidation in the automotive industry has no signs of a halt and, according to GlobalData, will continue into 2020.

The last quarter of this year was marked by the emergence of a huge alliance formed between the PSA Group and Fiat Chrysler Automobiles (FCA) to create the fourth largest automaker in the world. The former head of FCA, the late Sergio Marchionne, has long sought to enter into an alliance with another car manufacturer, and earlier this year, the FCA almost joined forces with Renault.

“The planned merger between these two major car manufacturers is not over yet, but they have quickly advanced to reach this agreement. The deal also underscores the importance of large-scale and joint investments in expensive advanced technologies such as electrification and autonomous drive, as the automotive industry will face transformation over the next ten years, ”said the analyst.

Earlier this week, Isuzu Motors and the Volvo Group signed a Memorandum of Understanding to form a strategic alliance for commercial vehicles. As part of the alliance, Volvo will sell its business to UD Trucks Isuzu for $ 2.3 billion. According to Leggett, this is “another step that has been triggered by wider industrial trends and the search for ways to save, which may be due to the wider scale and additional geographical presence.

Due to increased competitive conditions, companies are faced with increasing pressure. In order to control costs and position for transformational changes in mobility and the structure of the automotive industry, automakers will create other alliances next year.