Ernst & Young Present Automotive Sector Analysis

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Ernest & Young - March 5, 2013

In their latest assessment of the global automotive sector, Ernst & Young’s “Automotive Capital Confidence Barometer” gives insight into global economic factors.

Find out more about what automotive companies plan over the next 12 months.

Companies in the global automotive sector are backing away from big M&A deals and focusing on such fundamentals as cost control, risk management and capital allocation, according to the latest Ernst & Young Automotive Capital Confidence Barometer.

Jim Carter, Ernst & Young’s Americas Automotive Transaction Advisory Leader, notes that 61% of respondents expect the global economy to remain soft for at least a year. Only 16% predict their companies will make an acquisition in the next 12 months-less than half the proportion a year ago. Carter says Germany and the U.S. have replaced China and India as the most attractive regions for investment, mainly because of their relative economic stability.

General survey highlights include:

  • 87% feel the global economy is stable or improving
  • 92% expect to maintain or increase their workforce over the next 12 months
  • 23% plan to refinance loans or debt obligations in the next 12 months
  • 22% expect to make an acquisition in the next 12 months
  • 25% see divestments as likely in their organization over the next 12 months
  • 50% indicate growth as their company’s primary focus over the next 12 months

 

 

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