Connected cars are the future – and sales are set to rise
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Connected cars are the future – and sales are set to rise

According to Bloomberg New Energy Finance, the trend towards connected cars is about to deliver. Sales of cars that offer built-in cellular-network connectivity hit around 5.9 million a quarter at the beginning of the year. Then, they hovered there on a temporary plateau. But now, BNEF says that plateau is about to break, and sales will rise in the fourth quarter of the year. Next year, BNEF says, sales will rise to 7 million a quarter, and by 2025, most carmakers will be offering connectivity in 90% of their new models.

graph 1511 cars

A major player in the trend towards the future of the auto-industry is Aptiv. The company, which focuses on electrification, connectivity, and autonomous driving solutions, has long been a friend to carmakers. Although most of that lengthy relationship was engaged in under the name Delphi Automotive. Aptiv spun-off from Delphi to focus on what executives’ thought was the future of the industry, and it’s looking increasingly like the right move.

Aptiv’s share price has increased by 3% over the past month

graph 1511 cars2

Source: Yahoo Finance

Aptiv is well-positioned to capitalise on this rise in interest for connected cars – particularly due to an acquisition from earlier this year. In July, news broke that Aptiv would be purchasing Winchester Interconnect – a connectivity provider that works within the automotive space. At the time, Aptiv’s CEO and president, Kevin Clark, made the following comment:

"Winchester further establishes Aptiv as a market leader in connectivity solutions and is a strategic fit to our Signal & Power Solutions segment. By adding to our over $1 billion in non-automotive revenues today, this transaction further strengthens our adjacent market platform and leverages our harsh environment expertise in engineered components."

Disclosure

Dominion holds Aptiv in its Global Trends Managed Fund.


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