The annual Automotive News ranking of the top global suppliers reveals, they remain in much the same order of size as they were a year ago.
Top global suppliers (in $bn)
Bosch, Denso, Magna, Continental and ZF Friedrichshafen remain the world’s five biggest suppliers, in the same order as a year ago. Only two of the top 10—Valeo and Faurecia—changed rankings last year. They swapped positions on the list, with Faurecia № 9 and Valeo № 10.’
The cost of entry has risen in the past few years, making it hard for any but the wealthiest of companies to acquire the requisite technologies. “You can’t buy anything related to autonomous vehicle software technology now that’s not in the billions of dollars,” says Dietmar Ostermann, U.S. automotive advisory leader at PriceWaterhouseCoopers, who track global automotive merger and acquisition activities around the world. “Technology is the dominating factor in supplier strategy,” he said. “A few years ago, suppliers were on [a merger and acquisition] drive because automakers were moving to global platforms with global architectures, and suppliers needed to quickly merge and create more global capabilities to supply in all regions. The real need now is to be able to support electric vehicles, connected cars and autonomous driving.”
Last year, there were 20 deals each worth more $1bn—that’s twice the level of activity of the past three years. The sector recorded 903 merger-acquisitions during the year. Among those that reported a deal value, the average size was just under $287m.
