Auto Makers increasing partnerships as Future of Transportation Changes
As the future of transportation is rapidly approaching, auto makers are looking to alliances to secure their spot in the worl dof autonomous driving. With autonomous vehicles, the the skillet needed to compete in this competitive environment is vastly different than the previous competitive skills that were key to be successful. Taking the human out of the equation results in a very different product for transportation which requires a whole new strategy. Also, the self-driving venture is just too much for one company to do itself and without partnering many of these huge auto makers can not compete in the future. So as the future in the industry is moving away from actually building cars to focusing on the data, ride-hailing and connect car-services, the number of alliances is increasing. From 2016 to 2017 there was an increase of 131 alliances to 271 partnerships involving self-driving cars. The most recent partnership, between Honda and GM which agreed to develop a fully automated car, with Honda committed to investing 2.75 billion in GM’s self-driving Cruise LLC over the next 12 years. Also, Toyota has partnered with Uber and GM has partnered with Lyft to collaborate on self-driving technology. As the alliances are forming, it is also making way for newer competitors in the industry. Huge tech companies are increasing competition with auto makers to capture this huge opportunity. I think as time goes on and market share gets shifted, a lot of the iconic auto makers that had decades of success will no longer be able to compete in the changing industry.