Electric and Connected Cars
Credit by WBUR

When it comes to face 2022, the automotive industry keeps on finding the big changes in business model as the step of electrification increases and advances in connectivity technology endure. These changes increase the intense competition that undermines the brand tactics and have given a great increase to a big new chances for either Original Equipment Manufacturers (OEM) or new brands alike.

The changing landscape is showed by the seven new entrants in the Top 100 this year compared to two years before, and the inspiring growth from the current released brands. These new starters are racing up the ranks in terms of value, while more other growing brands have seen more submissive growth.

To make an inflexion point for the industry and the brands within it, the pressures should be combined with the evolving mobility, a shifting customer and regulatory landscape, changing drivetrain and model type requirements as well as new technology requirements.

However, the industry has evidenced the resilience along with the both increasing values and sales. Innovation continues to go up in a strong step while investment in new capacity. The electric vehicles (EVs) is rising in line with the customer demand which is also increasing. In spite of the pressure, the viewpoint for the industry is positive.

Recovering From The Pandemic in 2021/2022

All in all, automotive industry is getting recovery from pandemic effects. The saving growth and the relative low-interest rates have caused the demand to rise for all kinds of goods, including cars.

Consequently, unit sales volume in 2022 are expected to reach about 78 million of units, beating the pre-pandemic 2019 levels. This way, profits also increase on average across OEMs this year along with numerous record making.

The most popular models in this post-pandemic years are the SUVs and SUV Crossovers which continue to popularly grow in all regions. To some extent, this is eroding the previous big differences in model variety of popularity between the regions like the European tendency that prefers small cars and the US that prefers larger cars.

Though there is a positive view from the demand to the industry, EVs are considered performing much better in terms of relative growth. In 2021, the electric vehicles sales reached about 6.4 million. It is a 100% increase, representing a rise from 4.5% of all cars sold in 2020 to 9% in 2021.

The main problem in holding OEMs back is an access to microchips that is predicted to remain a problem for some time. Another big case to value the growth is the effect on investor mawkishness toward the big changes happening to the industry. This year, it has been noted the large increase in risk mawkishness for the industry that raises the financing expenses and reduces the values across the boards.

Partly, as the result of the additional risk, the automobile brand value proportion along with the Brand Finance Global 500 ranking fails for the first time in 3 years, that was from 7.3% to 6.8% of the total. The definite value of automobile brands in the Brand Finance Global 500 ranking actually increased by 5%. That is stronger in the growth for the tech, retail, media and travel sectors.

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