Could a merger help address European automotive’s struggles?

The European auto industry is at a crossroads. Its legacy automakers are facing challenges on a variety of fronts, particularly diminished cost competitiveness on electric vehicles (EVs) compared with segment leaders like Tesla. The German industry’s output shrank by 3.5% in August 2023, with Volkswagen ordering several temporary closures of its Emden EV plant as a consequence of flagging demand.