The line between the technology and automotive industries is blurring. The rise of rideshare companies such as Uber and Lyft means that transportation is being tied ever more closely to your cell phone, while autonomous driving technology is turning your car into a computer. But these developments are expensive: Carmakers’ R&D budgets jumped 61 percent, to $137 billion from 2010 to 2014.
Fiat Chrysler Chief Executive Officer Sergio Marchionne thinks it makes no sense for carmakers to spend billions of dollars developing competing, yet largely identical systems. To share some of the risk—and the cost—the incumbent automotive giants and their would-be disruptors are teaming up in an ever-growing, ever more complex series of alliances.