Temperature Check: Supply Chain M&A

As the transition into electrification and advanced mobility continues to accelerate, expect to see an increase in spinoffs and separation of electrification and advanced portions of manufacturing businesses from other sectors of operation. In addition, we anticipate a growing number of financially distressed suppliers look to exit their businesses through sale processes—though these processes can be complicated due to their lack of diversification into advanced mobility. This calls for specialized knowledge of the industry to understand whether and how the selling entity can be competitive and whether a sale can be accomplished and maintain success.

Activity level: Balanced growth