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Automotive Deals Stall In 2012 Compared To 2011, According To PwC

DETROIT, April 2, 2013 /PRNewswire/ -- Automotive mergers and acquisitions (M&A) activity in the first half of 2012 has given way to macroeconomic pressures, resulting in passive M&A activity in 2012 overall, PwC reports in Driving Value: Automotive M&A Insights 2012. The automotive industry's overall M&A deal volume declined 18 percent and deal value declined by 33 percent, compared to 2011. In comparison, in 2012, global cross-sector M&A activity declined less than the automotive sector, with deal volumes declining by seven percent and deal value declining by 17 percent compared to 2011.

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While some regions continue to show signs of stabilization and profitability after the recession in 2008-2009, the economic crisis in Europe is still an ongoing issue of concern. Europe's share of global automotive deal volumes is down for the second straight year, while Asia continues to grow its presence, becoming the largest acquirer region in 2012.

With Europe's debt crisis weighing heavily on the European automotive sector, automotive M&A activity declined in terms of deal volume and value when compared to 2011, when a total of 594 deals were completed for a disclosed value of $44.9 billion. The automotive sector transacted 98 deals during Q4 2012, marking the third straight quarter of decreasing deal volume.

"Uncertainty is hurting the deal value more than the actual recession," said Paul Elie, U.S. automotive transaction services leader. "There is increased speculation resulting from the looming economic challenges in Europe and many unknowns in the regulatory environment. As soon as the macroeconomic environment improves, we likely will see a wave of pent-up demand resulting in increased deal activity."

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The PwC report shows:

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