Global automotive M&A activity was strong in 2017. Automotive M&A deal value is up 29.9% to $53.2 billion. Volume is up 2.6% to 598 deals, and the average disclosed deal size increased 31.9% to $278.6 million.
The increase in value and average deal size is primarily driven by two megadeals in 2017 compared to zero in 2016. The two megadeals were in Auto-Tech segment accounting for $23.3 billion of deal value, or 43.9% of all disclosed deal value in 2017.
We define Auto-Tech as investments in connectivity, autonomous, electrification, ride-sharing and the software, sensors, intellectual property and other components that support these trends. Auto-Tech deal value increased more than fivefold from $5.3 billion in 2016 to $26.7 billion in 2017, primarily due to both megadeals in 2017 being Auto-Tech related. Auto-Tech deal volume was up 28.0%, from 50 deals in 2016 to 64 deals in 2017.
US acquirers spent $23.6 billion in 2017, or 44.4% of disclosed deal value. With recent tax reform in the U.S. and the expected repatriation of cash, we expect US acquires to drive M&A activity in 2018.
Volume growth in 2017 was driven by the Others sub-sector while all value growth was driven by the Component Supplier sub-sector.
Value growth was driven by Component Suppliers, as deal value more than doubled to $40.7 billion in 2017.
"Investments in connected, autonomous, and electrification made headlines and drove automotive M&A activity in 2017. Despite the risk associated with these Auto-Tech investments, this trend will continue to drive deal value in 2018."