Strategic alliances in an evolving automotive industry
Within the automotive industry, OEMs and suppliers alike are actively considering a range of joint ventures, partnerships, and alliances in order to stay competitive as the automotive landscape evolves. Industry leaders have recognized that their existing capabilities are not evolving quickly enough to compete effectively with new market entrants from the technology sector.
Through strategic alliances, industry incumbents are able to shoulder the upfront costs of new technologies, including the data analytics, artificial intelligence, and advanced telematics necessary for self-driving cars.
A few notable partnerships include:
- BMW and Daimler have announced a partnership involving 1,200 technicians from the two companies to develop self-driving technologies
- Toyota and Subaru have agreed to co-develop battery-electric vehicles, leveraging technologies from both companies
- Ford has announced a $500 million investment in Rivian. They will built a new electric vehicle on Rivian’s platform. This follows Amazon’s investment in Rivian earlier this year
While the proposed merger between FCA and Renault has been called off, it further illustrates the high value being placed on collaboration as a mechanism to compete in the future. However, it also demonstrates the complexities that come along with creating partnerships among established industry players – and historical competitors.