The New MotorWorld Order

Washington DC April 13, 2010; The AIADA newslettert reported that Alex Taylor III at CNN Money wrote that a couple of items in recent news clearly point to a new direction for the global auto industry: One was the decision by Daimler and Renault-Nissan last week to cooperate in the development of small cars and small engines. The other was the news that General Motors sold more vehicles in China during the first quarter of 2010 than it did in its home market of North America.

According to Taylor, the two messages couldn't be clearer: Automakers need scale in order to amortize the escalating costs of new technology and product development. And they also need a strong presence in developing markets because their traditional strongholds in the U.S., Western Europe, and Japan have all but stopped growing or in some cases are shrinking. Analysts and automakers have been talking about consolidation of the industry into supergroups since at least the 1970s.

But independents like BMW and Honda have thrived. And Korea has emerged as a power, some 100 automakers have sprung up in China, and India has leapt onto the world stage with the innovative Nanocar.

Click here for Taylor’s outlook on the future of global automaking.