Crain’s Detroit Business is predicting some tough times ahead for automotive suppliers, as slow sales and industry consolidation create excellent conditions for disruption.
The publication points out that the automotive sector in the U.S. lost some 22,000 jobs through May of this year, and is on track to lose over 30,000 jobs by the end of the year. Last year the auto sector was trimmed by 30,500 jobs.
New vehicle sales this year are predicted to come in below 17 million units – the first time since 2014.
And the consolidation trend is continuing, Crain’s pointed out.
Global supplier merger and acquisition activity is near record highs, according to PwC’s 2019 Auto Supplier Consolidation study released last week at the Center for Automotive Research’s Management Briefing Seminars in Traverse City.
Global auto supplier deal values are expected to reach $44 billion in 2019, well above the average of $20 billion.