Chicago, December 21, 2022 /PRNewswire/ — Market conditions have changed M&A strategies, but overall deal volume remains unchanged, according to an automotive aftermarket industry report released by the Brown Gibbons Lang & Company (BGL) automotive investment banking team. There was no.
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Market conditions have changed M&A strategies but not overall transaction volumes, according to an automotive aftermarket industry report released by the Auto Investment Banking team at Brown Gibbons Lang & Company (BGL).
Within the report, BGL shares its annual summary of the 2022 SEMA Show, examining developments impacting automotive aftermarket M&A strategies.
Key automotive M&A themes impacting deal activity in the current environment include:
- Economic uncertainty has pushed consumer spending away from new vehicles, increased maintenance of existing vehicles, and directed purchases toward DIY and DIFM products and non-discretionary services such as mechanical and crash repairs. As a result, his M&A deals involving suppliers of replacement parts and repair equipment are booming.
- Supply chain challenges were mitigated, but not completely. Some companies are rethinking production reshoring or nearshoring. However, domestically-produced companies remain attractive M&A targets. The vertical integration strategy through acquisitions is also progressing.
- With major automakers announcing heavy investments to accelerate the adoption of electric vehicles (EVs), and EVs expected to eventually make up the majority of vehicles, electrification is no longer a “what if” vehicle. It’s not a question of “when”. Aftermarket companies specializing in powertrain related components must also look to the future. Powertrain component suppliers have turned to M&A to add features that prevent obsolescence. Private equity is also looking for powertrain-related businesses with such plans.
- American buyers love trucks and SUVs, and automotive market share is shifting as changing tastes influence consumer buying behavior. Companies that manufacture aftermarket performance and appearance-enhancing products for trucks and his SUVs continue to be an attractive area for consolidation.
About Brown Gibbons Lang & Company
Brown Gibbons Lang & Company (BGL) is a leading independent investment bank and financial advisory firm focused on the global middle market. The firm advises private companies, public companies and private equity groups on mergers and acquisitions, capital markets, financial restructuring, business valuations and opinions, and other strategic matters. BGL has an investment banking office. Chicago, cleveland, angelsWhen New Yorkand real estate offices Chicago, clevelandWhen St. AnthonyThe company is also a founding member of Global M&A Partners, enabling BGL to serve clients in over 30 countries around the world. Securities trading is conducted through Brown, Gibbons, Lang & Company Securities, LLC, affiliates of Brown Gibbons Lang & Company LLC, registered broker-dealers, members of FINRA and SIPC. For more information, please visit www.bglco.com.
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