Feb 28, 2019

Why are more and more car companies teaming up?

For one thing, the German giants - who plan to work on driverless vehicles, ride-hailing, and pay-per-use cars together - are normally fierce rivals who would never dream of teaming up. So traditional carmakers are having to fight to remain relevant, particularly as tech companies like ride-hailing firm Uber and Google's driverless car business Waymo overtake them. Perhaps the bigger threat driving carmakers to team up is that car ownership could fall, as driverless vehicles take off and we increasingly opt to rent or borrow cars rather than buy them. While more and more car firms are teaming up, their agreements are rarely exclusive or involve cross ownership. He instead expects to see more "Rationalisation", with carmakers pulling out of unprofitable markets and forging more strategic pacts in the vein of Daimler and BMW. Car firms that fail to adapt will face an uncertain future, however.

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