Automotive Newsletter Q2 2025

Market overview

In Q2 2025, the automotive industry continued to face uncertainty due to the tariffs imposed by the US government on cars, automotive parts, and other imports such as steel and aluminium. Stagnant short-term production forecasts, overcapacity, and a slower-than-expected transition to electric vehicles (EVs) continue to pose major challenges, prompting companies to act cautiously with investments.

engineers walking while discussing by car chassis

The number of automotive M&A deals increased from 57 in Q1 2025 to 64 in Q2 2025. In Q2 2025, M&A activity was primarily driven by transactions in the automotive aftermarket, new vehicle solutions, and xEV, as well as distressed automotive suppliers.

Across Europe, valuation multiples showed a strong performance in Q2 2025, compared to Q1 2025. EV/Sales, EV/EBITDA, and EV/EBIT increased by 10.7%, 15.6%, and 10.4%, respectively. In North America, all key multiples increased significantly, with EV/Sales up by 18.0%, EV/EBITDA up by 19.3%, and EV/EBIT up by 22.3%. Asia also demonstrated overall growth, as EV/Sales, EV/EBITDA, and EV/EBIT increased by 6.6%, 11.2%, and 18.7%, respectively.

Although the full magnitude and impact of the US tariffs remain uncertain, companies are compelled to prepare for long-term consequences. Securing supply chains, diversifying end markets, and broadening product portfolios will be critical in navigating geopolitical and industry-specific challenges. These factors are expected to drive strategic alliances and future M&A activity, as companies seek adaptive solutions and growth opportunities.

The number of automotive M&A deals increased from 57 in Q1 2025 to 64 in Q2 2025.

Top M&A deals Q2 2025

Novares Group SA (Novares), a leading French manufacturer of plastic components and systems for the automotive industry, acquired by Global Technologies Sarl (Global Technologies) from Equistone, Bpifrance, and other minority shareholders. Global Technologies, a European-based investment vehicle of the First Brands Group, completed its first acquisition with Novares, marking an important step in Global Technologies’ long-term vision to build a network of industry leaders. The transaction is expected to generate operational synergies, enhance global presence, and accelerate research and development efforts, which will create new opportunities for growth and collaboration.

KTM AG (KTM), an Austrian manufacturer of motorcycles and recreational vehicles, has been acquired by Bajaj Auto Ltd (Bajaj Auto) from Pierer Industrie AG. Previously a minority shareholder, Bajaj Auto’s investment will secure KTM’s operational continuity, following its restructuring process initiated in February 2025. The transaction strengthens Bajaj Auto’s position as a global player in the premium motorcycle segment and is expected to accelerate KTM’s international growth as well as drive product innovation. By joining forces, both companies aim to leverage their complementary strengths and expand their presence in key markets worldwide.

Indigo Technologies Inc. (Indigo), a US-based developer of lightweight electric vehicles for ride-hailing and last-mile delivery, secured €47.4m ($54m) in a funding round led by FedEx, Foxconn, and FM Capital. The investment will support the rollout of Indigo’s next-generation EVs and reinforce its position in urban mobility solutions.

Download our Automotive Newsletter here

Transactions

Not just numbers on a balance sheet, our transactions represent over 20 years’ commitment to our clients’ future. Helping them change the game. Even before it was ready to be changed.