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We have all heard the story of how eagles goes through molting process where in they gradually loose their feather and beak and in the end come out with the regrown body parts making it stronger than before.

Does this story find any relevance in the news flow going around when the entire automotive industry is struggling to maintain margins in an ultra-competitive era and ever modernizing technology landscape.

Lets take a quick look with bird's eye on whats going around in industry.

Automotive OEMs are facing severe headwinds in maintaining top-line growth and margins; and the  investors have been losing skin to hold their stocks, why?

  1. Almost everyone knows how to make a good car.

  2. Auto-motives are being blamed 'almost entirely' for all the emissions.

  3. Rising costs to maintain a functioning vehicle.

  4. Electric vehicles are making more 'sound' than they are being 'consumed'.

All this is leaving consumers confused and delaying or almost giving up on buying new vehicles.

This is what we see when face the news flow through the mainstream media.

Lets see what else is happening on ground.

  1. EVs comprise lesser components than conventional ICE vehicles which is shifting some business out of the hands of Auto component suppliers to OEMs. [EV comprises ~100 components as compared to ~2000 in ICE of course]

  2. OEMs are setting up own battery manufacturing units [links below], which would cause permanent dent in the conventional energy business to the likes of both up and down stream oil majors.

This in totality means business getting consolidated into the hands of OEMs from component suppliers and energy suppliers, which in itself is a big shift. Auto industry is not only getting transformed with the advent of electric vehicles but also grabbing business from both sides.



BMW setting up battery manufacturing unit

Suzuki to commission battery manufacturing plant

Tata Group setting up Lithion-ion battery plant in Gujarat 


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