Mexican Media Brands
Auto vs. Tech: Guess Who Wins
Matthew Simoncini, president and CEO of Lear Corp., provided some fairly compelling figures this week at the CAR Management Briefing Seminars that show just how out-of-whack the valuations of tech companies are vis-à-vis auto companies.
#economics
.jpg;width=70;height=70;mode=crop)
Share
Matthew Simoncini, president and CEO of Lear Corp., provided some fairly compelling figures this week at the CAR Management Briefing Seminars that show just how out-of-whack the valuations of tech companies are vis-à-vis auto companies.
He created two groups, one consisting of Toyota, Volkswagen, Daimler, GM and Ford, and the other including Apple, Alphabet, Microsoft, Amazon, and Facebook.
Arguably, the Clash of the Titans.
.jpg "Toyota")
The revenue for Automotive is on the order of $1-trillion. For Tech the revenue is $0.6-trillion.
Automotive has 1.7-million employees. Tech 0.7-million employees.
So far things don’t seem all that unusual. The revenues are fairly close. And obviously the number of employees needed to manufacture cars and trucks is greater than the number of people who are designing interfaces, writing code and, at least in the case of Amazon, presumably, working in fulfillment warehouses.
But it is when Simoncini gets to the market capitalization that things are rather eye-opening.
Auto’s market cap is $0.4-trillion.
Tech’s market cap is about $3-trillion.
Seems like the global investment community is more than a little partial to Tech.
The whole phenomenon of auto companies presenting themselves as being “like” tech companies isn’t fooling a whole lot of people. At least not those with investment monies.
RELATED CONTENT
-
On The German Auto Industry
A look at several things that are going on in the German auto industry—from new vehicles to stamping to building electric vehicles.
-
China and U.S. OEMs
When Ford announced its 3rd quarter earning on October 24, the official announcement said, in part, “Company revenue was up 3 percent year over year, with net income and company adjusted EBIT both down year over year, primarily driven by continued challenges in China.” The previous day, perhaps as a preemptive move to answer the question “If things are going poorly in China, what are you doing about it?, Ford announced that it was establishing Ford China as a stand-alone business unit.
-
On Urban Transport, the Jeep Grand Wagoneer, Lamborghini and more
Why electric pods may be the future of urban transport, the amazing Jeep Grand Wagoneer, Lamborghini is a green pioneer, LMC on capacity utilization, an aluminum study gives the nod to. . .aluminum, and why McLaren is working with TUMI.