With 591 deals in 2015, the industry saw its highest volume of deals transacted since 2011 and 9% more than in 2014, according to an analysis by PwC. And the outlook is strong for 2016 as well.
Deal value and size increased by even more. The average automotive deal size increased by 81% to $388 million from $214 million, the consulting firm said, while the overall deal value in 2015 was up 60% to $62.1 billion, the highest mark in 16 years.
Much of the deal value and deal size increases, PwC said, can be attributed to the year’s record-setting 12 megadeals, with a total aggregated disclosed value of $46.3 billion. But that meant nearly $20 billion in deals was conducted by smaller companies, including many of the mid-market concerns that form the backbone of the Tiers 2, 3 and 4 in the automotive supply chain.
In fact, PwC said, local deals dominated M&A activity across all regions with 83% of all deal volume consisting of local deals, within one continent. After Europe, North America ranked as the No. 2 region in local deals, with 136.
And the largest accelerator of M&A activity during 2015, PwC reported, was component suppliers, a sector that is dominated by mid-market companies. Deal value there nearly doubled to $32.9 billion compared with 2014, indicating that many mid-market CEOs in the auto-supply business had M&A on their minds.
But some experts question if the auto industry can continue to break sales records, meaning that it’s even more critical for companies to respond to consumer demands for new technology and features—which, in turn, places more pressure on suppliers.
Other factors that will continue to influence automotive CEOs as they consider the need or desirability of M&A activity, PwC said, include responsiveness to opportunities in new geographic blocs, production-plan flexibility as lower gasoline prices affect vehicle sales segmentation, and the need for investments in electronics and alternative forms of mobility such as ride-sharing.
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns. They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning. Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process. This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented. If you are ready for a Strategic Planning tune-up, select this workshop in your registration form. The additional fee of $695 will be added to your total.
2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
