Partnering to Make Profits in the Auto Industry

In a CNBC article, Guidehouse Insights explains why automakers are teaming up to produce the next generation of autonomous and electric vehicles

Recently automakers have been investing billions of dollars in partnerships as the industry races to produce autonomous and electric vehicles (EVs).

In a CNBC article, Guidehouse Insights’ Sam Abuelsamid, principal research analyst, explained why partnerships are emerging in the market and what challenges automakers are trying to overcome.

While the most well-known collaborations have been between tech companies and automakers this year, there have also been many automakers teaming up to share costs with their traditional competitors. 

“These companies, especially on the autonomous side, they’re finding it’s harder to develop this stuff than they thought it was going to be, so they’re teaming up to spread those costs and share the expertise that they have across a broader range of vehicles to try and get some scale,” Abuelsamid said.

Over the past decade the auto industry has struggled to make EVs profitable; this is something many automaker executives are promising to fix for the next generation of EVs. 

“For competitive reasons and also for regulatory reasons, everybody has to have EVs in their lineup. The challenge is selling them profitability,” Abuelsamid said. “That’s something everybody has struggled to do so far.”

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Read the CNBC Article
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