Cognizant announced that it is acquiring Munich, Germany-based ESG Mobility, a digital automotive engineering R&D provider for connected, autonomous and electric vehicles. ESG Mobility is a wholly-owned subsidiary of ESG Elektroniksystem – and Logistik – GmbH, a privately-held technology consultancy for the design, integration and operation of complex, security-related electronic and IT systems. Upon the close of the acquisition, approximately 1,000 engineering R&D specialists will join Cognizant in the automotive innovation hubs of Germany, the US and China.

Acquiring ESG Mobility will expand Cognizant’s automotive engineering expertise, particularly in connected vehicles. The global connected car market was valued at approximately $63 billion in 2019, and is projected to reach more than $225 billion by 2027, according to Allied Market Research. Among the growth drivers is the European Commission’s Third Mobility Package, which requires development of safe, clean, connected cars and autonomous and electric vehicles, as well as all new vehicles to be connected to the internet by 2022.

“The automotive industry is undergoing a fundamental shift, embracing new mobility concepts that rely heavily on software, connectivity and artificial intelligence,” said Malcolm Frank, President of Digital Business and Technology, Cognizant. “Our priority is providing clients with the capabilities they need to compete as modern digital businesses, and ESG Mobility is a natural complement to our existing connected mobility offerings and global delivery model. This acquisition will empower our clients to innovate more quickly in shaping the future of transportation. We look forward to welcoming ESG Mobility’s talented team to Cognizant.”

Cognizant and ESG Mobility together, upon the close of the acquisition, will provide engineering services to eight of the world’s top 10 automotive original equipment manufacturers (OEM).

ESG Mobility provides services across the automotive software stack with key strengths in electrical and electronic systems and connected vehicle applications, as well as emerging capabilities for autonomous and electric vehicles.

“We have built a world-class team of engineering R&D and technology consultants who deeply understand our automotive clients in Germany and around the world,” said Jörg Ohlsen, Chief Executive Officer, ESG Mobility. “By joining Cognizant, we can provide a higher quality of service, build more innovative products and support a broader range of digital initiatives for our current and future customers. We look forward to using our vast automotive industry experience to create a more connected, mobile world.”

The transaction is expected to close in the second quarter of 2021, subject to the completion of closing conditions. Upon completion, ESG Mobility employees will become part of Cognizant’s Internet of Things (IoT) and Engineering Services Practice. Financial details were not disclosed.

The ESG Mobility transaction marks Cognizant’s fourth acquisition in 2021, and 13th acquisition since January 2020, further expanding its capabilities in key digital focus areas of cloud, data and artificial intelligence, digital engineering and IoT.