Automotive Industry Valuation Benchmarks (2009-2024)

The global automotive supplier market was valued at $997.4 billion in 2022 and is estimated to reach $1.3 trillion in 2030, growing at a CAGR of 4.1% from 2022 to 2030, demonstrating consistent expansion. A recent automotive industry analysis released by the Automotive & Aftermarket investment banking team from Brown Gibbons Lang & Company (BGL) in conjunction with REACH Cross-Border Mergers & Acquisitions takes a closer look at key industry trends over the past 15 years.

The report excerpt below examines the valuation trends in the global automotive sector over the past 15 years, focusing on several key transaction metrics, such as EV/EBITDA and EV/Revenue.

Key Observation Benchmarks on Automotive Industry Valuations

• The Automotive Supplier Index market is currently trading at 7.9x as of July 2024, above its 15-year median of 6.6x, driven by M&A activity, consolidations, and higher valuations for larger, more efficient companies.
• Collaborations and partnerships among automotive suppliers and technology firms have strengthened market positions and boosted valuations.
  • In October 2023, Continental partnered with Munich-based high-tech company Deep Drive to develop integrated drive and brake systems for electric vehicle wheels. This collaboration aims to improve range, efficiency, and sustainability, combining Continental’s brake expertise with Deep Drive’s innovative electric motor technology.
• Strong revenue growth driven by increased vehicle production and sales, especially in emerging markets, along with enhanced operational efficiencies and cost management, has improved profit margins and attracted investors.
• Investments in resilient, adaptable supply chains continue to drive auto supplier M&A.

The automotive industry faces a dynamic array of challenges driven by technological advancements, regulatory changes, and evolving consumer preferences. However, the market is experiencing modest growth, with significant shifts in patterns. You can read more about these trends and challenges in the full 51-page Insider report.

Contact our Automotive & Aftermarket Investment Banking Team
Led by Todd R. Cassidy, BGL’s Automotive & Aftermarket team maintains coverage of the broad automotive sector and brings a unique perspective, with experience as both operators and advisors within the sector. Please reach out via our contact form to learn more.