Dear MEL Topic Readers,
Welcome to the New World Order of automakers. Soon, only the big survive
Around 75 million new cars were sold in 2023 and 2024 respectively. The number of new energy vehicles (NEVs), including battery electric and plug-in hybrid cars, accounted for around 20% of the total sales in 2023 and over 22% in 2024. The growth of NEVs has been driven by China, where over 10 million NEVs were sold last year, or about one in three new cars. While the shift to NEVs from gasoline-powered vehicles has given advantages to newly born NEV-only automakers like the US’s Tesla and China’s BYD, it is putting pressure on traditional automakers in the US, Europe, and Japan. In fact, they are losing businesses, especially in China and Southeast Asia. Also, the cost of developing NEVs, especially the batteries and power units, has pushed the prices of NEVs and slowed sales growth in Europe and the USA. Furthermore, R&D investment for auto-driving is becoming too much of a burden even on large automakers like Toyota, GM, and Volkswagen. One way to manage the increasing costs and heating competition is a merger. Last year, Honda and Nissan announced that they agreed to merge by 2026. But will the size still matter as much as the focus and speed in the new auto market?
Read the article and learn about the survival game in the auto industry.
https://edition.cnn.com/2025/01/03/business/automaker-mergers-to-come/index.html
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