Industry insiders see an automotive landscape emerging where traditional players increasingly have to compete with nimble new market entrants. Moreover, disruption is pre-programmed as electrification may well put at risk the huge market for automotive components and systems now geared to combustion engines. And analysts predict that battery producers, a new category of automotive players, are going to emerge as key suppliers in the era of electrified propulsion.
Sales of electric vehicles are picking up, but they continue to represent just a tiny slice of the global car market. According to Germany’s Center of Automotive Management, global sales of electric vehicles, driven mostly by Chinese demand, are set to jump 40% this year to 2.7 million units. Their share of the global market will jump from of all new cars sold.While electronics companies can use their scale derived from supplying other sectors to establish themselves in the auto industry, things are likely to be tougher for established automotive suppliers.
But sales are likely to grow more rapidly as carmakers roll out more electric vehicles, charging infrastructure problems are tackled and consumer acceptance grows. AlixPartners, in a new study, found that car manufacturers can be expected to increasingly move away from traditional powertrains, as emissions regulations are tightened in Europe and elsewhere.
The consultants calculate that global automakers are planning to bring more than 200 electric models to market between now and 2022.As electrification takes root, the potential for new entrants to the electric-vehicle supply chain is huge. That’s particularly true for big electronics companies such as LG, Panasonic and Samsung, for IT groups and for battery makers.