Globalisation: Value Chain and Automotive Industry Essay examples
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Int. J. Technological Learning, Innovation and Development, Vol. 2, Nos. 1/2, 2009
Globalisation of the automotive industry: main features and trends
Timothy J. Sturgeon
Industrial Performance Center (IPC),
MIT, 292 Main Street (E38-104),
Cambridge, MA 02139, USA
E-mail: sturgeon@mit.edu
Olga Memedovic*
United Nations Industrial Development Organization,
Vienna International Centre,
A-1440 Vienna, Austria
E-mail: O.Memedovic@unido.org
*Corresponding Author
Johannes Van Biesebroeck
Department of Economics, University of Toronto,
150 St. George Street,
Toronto, Ontario M5S 3G7,Canada
E-mail: jovb@chass.utoronto.ca
Gary Gereffi
Department of Sociology,
Duke University,
Durham, NC 27708-0088, USA
E-mail: ggere@soc.duke.edu
Abstract: This paper lays out the main features of the global automotive industry and identifies several important trends. A boom in developing country sales and production has not yet overshadowed the importance of existing markets in developed regions. Regional integration is very strong at an operational level, yet the industry has recently developed a set of global-scale value chain linkages, and retains national and local elements as well. The paper highlights how global, regional, national and local value chains are nested to create a pattern of global integration that is distinctive to the industry. We use global value chain analysis to help explain the limits of build-to-order in the industry, the role of regional and global suppliers, the shifting geography of production and how the characteristics of value chain linkages in the industry favour tight integration and regional production. We describe how industry concentration focuses power in the hands of a few large lead firms and discuss the implications of this for value chain governance and the geography of production. Keywords: globalisation; automotive industry; vehicle assembly and parts;
GVC; global value chains.
T.J. Sturgeon et al.
Reference to this paper should be made as follows: Sturgeon, T.J., Memedovic,
O., Biesebroeck, J.V., Gereffi, G. (2009) ‘Globalisation of the automotive industry: main features and trends’, Int. J. Technological Learning, Innovation and Development, Vol. 2, Nos. 1/2, pp.7-24.
Biographical notes: Timothy J. Sturgeon is a Senior Research Affiliate at the Industrial Performance Center (IPC) at the Massachusetts Institute of Technology (MIT). He has a PhD in economic geography from U.C.
Berkeley, and is Co-Organizer of the Global Value Chains Initiative
(www.globalvaluechains.org). Tim served as Executive Director of the IPC’s
Globalization Study, and Globalization Research Director for the International
Motor Vehicle Program at the Center for Technology, Policy and Industrial
Development. His papers have appeared in international peer-reviewed journals including Industrial and Corporate Change, Review of International
Political Economy, Journal of East Asian Studies, and Journal of Economic
Geography, and as chapters in edited volumes, the most recent being, ‘From commodity chains to value chains, interdisciplinary theory building in an age of globalization’, in Jennifer Bair (Ed.): Frontiers of Commodity Chain Research,
Stanford University Press, forthcoming, October 2008.
Johannes Van Biesebroeck is an Associate Professor of Economics at the
University of Toronto and a Faculty Research Fellow at the National Bureau of
Economic Research. His work on the automobile industry has been supported with grants by the Social Science and Humanities Research Council, the
Canadian Foundation for Innovation, and the Ontario Innovation Trust and for his current research on supply chains he is a Network Researcher of AUTO21, the Canadian Network of Centers of Excellence, and of the International Motor
Vehicle Program in Boston. He has served as a consultant on the automotive industry for
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