BusinessBusiness RecoveryAutomotive industry to be hit by insolvencies

Automotive industry to be hit by insolvencies

Insolvencies and mergers to change the face of the automotive industry

The automotive industry faces major overhaul as insolvencies and mergers will
change the face of players in the market over the next few years.

A survey of the global automotive industry by
KPMG
found that 87% of respondents expect
insolvencies
in the industry to increase or remain the same over the next five years. In
turn the majority of respondents also expect an increase in global alliances,
mergers and acquisitions during the same period.

‘With global overcapacity still a major concern, a reduction in car
production capacity and developing competitive cost structures are the key
priorities for the industry,’ said KPMG head of automotive Mike Steventon.

‘It is also indicative of the industry’s determination to tackle the
fundamental problems which have resulted in the industry collectively, and the
US manufacturers and suppliers in particular, not generating an adequate
financial return. This is likely to be a painful journey in the short term but
absolutely necessary to build a long term, sustainable industry.’

Further reading:

Little Chef enters administration then
sold

Music Zone and Greeting Card Group enter
administration

Christmas excess boosts insolvencies

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