The Cyclical And Secular Of The Auto Market: Context Update

The Cyclical And Secular Of The Auto Market: Context Update

In March, General Motors announced that it was laying off 1,100 workers, the fourth layoff announcement for the company since November 2016. The four rounds of layoffs will cut a total of 4,400 jobs. In July, GM joined other automakers in a $159 millionfunding round for Nauto, a Silicon Valley startup that is developing software for self-driving vehicles. In May, Ford announced that it was cutting 1,400 salaried workers, about 10 percent of its staff. In June, Ford announced that it was creating a new robotics and AI research team to work with Argo AI, a startup in which Ford took a majority stake earlier in 2017. The Ford-led group will be working on projects for drones, personal mobility platforms, automation and aerial robotics. These moves by two of Detroit’s“Big 3” are reflective of the cyclical and secular challenges facing the auto industry today. The auto giants are joined by others in the industry in attempting to deal with a cyclical slowdown in sales, while at the same time investing for the major secular changes encroaching on transportation.

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