google self driving car.automotiveIT

Google, which is testing a self-driving car, may be planning
more automotive action (Photo: Google)

Embattled automakers should take inspiration from the high-tech industry and embark on a massive transformation of their business model, according to a new analysis by two Cisco consultants.

The analysis, called "Electronics-ization in Automotive," paints a picture of an auto industry that has failed to sufficiently innovate, hasn't capitalized on its inherent strengths and has neglected to embrace new business philosophies.

As a result, the sector's return on capital employed is only about a third of the return realized in the high-tech industry.

The Cisco analysts offer five concrete suggestions for change in the auto industry.

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