Aggressive emission and carbon neutrality targets set by regulators worldwide entails a faster transition from traditional automakers to next-gen electric vehicle (EV) manufacturers. Therefore, automakers are committing operational investments of nearly US$600 billion to secure their position in the future automotive market, according to GlobalData, a leading data and analytics company.

Broadly, the investments announced focus on the development of production facilities, technology, EV batteries, new product and securing future raw material supply (primarily semiconductors and battery materials). Autonomous vehicle development also remains a closely linked area to the investments.

The investments affirm that the future must be electric and there is no turning back for traditional automakers. However, the flurry of announcements from the OEMs could also be interpreted as a high-stakes game of one-upmanship or a corporate PR exercise to boost investor confidence. With all OEMs taking the same path, it is unlikely that any long-term sustainable competitive advantage will be conferred and that visibility over the billions of dollars of planned xEV investment is a price of market participation.

—Bakar Sadik Agwan, Senior Automotive Consulting Analyst at GlobalData

VW Group stays on the top of the list with a US$100.5-billion investment through 2030. Its ambition to surpass Tesla is no secret, says GlobalData, and the company wants four out of every 10 cars it sells to be a BEV by 2030.

A further analysis, looking at the contribution to xEV growth of each OEM derived from the latest LMC light vehicle powertrain forecast, sheds further light on the returns expected. VW is estimated to have the highest cumulative contribution to EV growth over the next decade when mapped against the investment announced, amongst the players analyzed.

However, there is no apparent correlation identified between the level of investment announced and expected contribution to growth as can be seen in the case of Ford, Stellantis and GM.

—Bakar Sadik Agwan

Despite being a pioneer in hybrid vehicles, Toyota was slow to implement BEV strategies; President Akio Toyoda announced the bZ EV brand only last year. Toyota plans to launch 30 models by 2030. Prior to this, Toyota had only a few BEV models manufactured with its Chinese partner GAC Group. Toyota announced US$70.4 billion investment in EVs to 2030, early this year.

Toyota has the highest growth contribution given the level of investment announced but remains largely attributed to hybrid vehicles, followed by battery and hydrogen-powered vehicles. It is near the top of the game for companies active in the EV space. GlobalData’s alternative datasets signal Toyota’s leadership down the line. The company leads in deals (M&A, partnerships, JV, etc.) and is an innovation leader with the highest number of patents filed amongst other global automakers.

Nevertheless, the investment announced remain important for automakers from a perspective of sustaining the ongoing disruptions in the automotive industry. Automakers need to be tech-efficient to combat technology rivals invading the auto industry.

—Bakar Sadik Agwan