The formerly rather sluggish automotive industry has long recognized the innovative power of startups. The number of venture capital investments is rising rapidly.
The management consultancy Oliver Wyman examined the corporate venture capital (CVC) activities of leading automakers: BMW, Daimler, VW, Audi, PSA Group, Jaguar, Volvo, GM, and Ford. This year alone, up to the beginning of September, these nine companies invested in 52 tech startups. In 2016 as a whole, the same companies made 41 investments, compared to just 16 in 2015.
The most sought-after sectors for investments are mobility services (32%), green vehicles (22%), including electric or fuel cell vehicles, and connected and autonomous vehicles (16%). Andreas Nienhaus by Oliver Wyman says:
“Manufacturers have recognized that they need to increase their efforts in these future fields and are increasingly taking action.”
BMW leads global ranking of car manufacturers
BMW leads the long-term ranking of CVC investments with 37 investments. It is followed by Daimler with 36 and GM with 35. Volvo (27), Ford (24), and Toyota (18) are in the middle. Volkswagen (12), Honda (9), and Audi (8) are only slightly ahead of the French manufacturers Renault (7) and PSA (6). The study authors note, however, that this ranking could change quickly. Toyota and PSA already have their own investment funds modeled on BMW i Ventures, which has a capital of 500 million euros, BMW also operates the Venture Client Program BMW Startup Garage.
New competition from the tech industry
The study sees competition from a new direction in the globally leading mobility startups:
“New players like Uber and DiDi Chuxing are entering the market and challenging the established manufacturers,”
says Nienhaus.
“They are also increasingly investing in startups and have now completed 21 investments each.”
The Japanese telecommunications and media group Softbank recently invested $5.5 billion in the Chinese ride-hailing company DiDi Chuxing. According to Oliver Wyman, Softbank is also preparing a $10 billion investment in Uber and is also investing in the autonomous driving sector.
