Before COVID-19, automakers were investing in the latest technologies at great cost to their balance sheets. Gary Silberg, Global Sector Head for Automotive, anticipates that they will continue to try to meet consumer demand for autonomous vehicles, connected cars, and electrification by sharing costs and risks. The result will be an upward trajectory of amazing future developments within the industry.
The auto industry, pre-crisis, was grappling with incredible amounts of change. They were investing, of course, in these awesome, cool products that they make every year, but at the same time they had to invest in autonomous vehicles, they were investing in electrification, they had connected cars and, of course, they were grappling with mobility as a service and demand issues related to that. And throw in digital for the consumer side of it and their balance sheets were in significant trouble trying to invest in all that.
So, what did you see pre-COVID? You saw a lot of joint ventures. You saw a lot of risk mitigation. And what I think you’re going to see post-COVID is really an acceleration of two things. One, a maniacal focus on the areas where the auto industry needs to be great at, and do it themselves. But more importantly, I think you will see a continuation of the sharing through joint ventures, alliances, perhaps even acquisitions, of sharing the cost and risk associated with these high tech, very expensive, new technologies that the consumers are demanding going forward.
It should be very exciting going forward, as it was pre-COVID, and I’m looking forward to, albeit a tough time for now, I think going forward the trajectory for all the amazing stuff that we look forward to will even be better than before.