Automotive industry deal values globally increased 24% to $13.1 billion in the first half of 2013 compared to the same period in 2012 ($10.6 billion) according to PwC’s recently released report, Automotive M&A Insights: Mid-Year Report 2013. While deal values were up, automotive deal volume slowed by 14% compared to the first half of 2012, which continues a trend from last year. PwC reports that there were 222 M&A transaction in the automotive sector, primarily in non-assembly businesses. The increase in deal values was driven primarily by the Component and Other sectors (including retail, aftermarket, rental/leasing and wholesale), where deal values increased by 84% and 121% respectively. Vehicle manufacturer/assembly deal activity and deal value dropped sharply.
Financial buyers continue their strong investments in the automotive industry, with $6.8 billion in investments in the first half of 2013. Small and mid-size deals made up the bulk of the M&A activity (only two deals over $1 billion were reported in the first half of 2013).
PwC expects deal activity to improve, in particular given overall optimism for global automotive sale and as next generation technologies continue to be integrated into new vehicles.