This is true of both national and international mergers, as the Oliver Wyman study “Mergers and Acquisitions in the Automotive Supply Industry” shows. Tier 1 suppliers in particular should upshift with regard to M&A, as globalization forces auto manufacturers to raise the bar and pressures Tier 1 suppliers to quickly achieve critical mass. However, the M&A process also presents enormous challenges to auto suppliers. Clear strategies and efficient post-merger integration are prerequisites for a successful transaction.
Stock markets are reacting much more favorably to mergers and acquisitions (M&A) among automotive suppliers than to M&A in other industries. Shares in the automotive supply industry often rose the moment strategic corporate transactions were announced.