The Globalization of Automobile Production
This paper is based on research from an in-progress project on the effect of globalization on competition and jobs in the automotive industry.3 Its purpose is to gain a clearer picture of the emerging economic geography of automobile production. The project has found that automakers and their Tie...
| Main Authors: | , |
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| Language: | en_US |
| Published: |
2002
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| Subjects: | |
| Online Access: | http://hdl.handle.net/1721.1/685 |
| _version_ | 1826199983846588416 |
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| author | Sturgeon, Timothy Florida, Richard |
| author_facet | Sturgeon, Timothy Florida, Richard |
| author_sort | Sturgeon, Timothy |
| collection | MIT |
| description | This paper is based on research from an in-progress project on the effect of
globalization on competition and jobs in the automotive industry.3 Its purpose is to gain a
clearer picture of the emerging economic geography of automobile production. The project
has found that automakers and their Tier 1suppliers are aggressively internationalizing their
operations in search of new markets and lower production CONS. At the same time, the
largest automakers are attempting to centralize the product development and corporate
control functions of their organizations in their home locations, where they are wor~ng
more closely than ever with Tier 1 suppliers. we believe that both the centrifugal and
centripetal aspects of the ?globalization? prwess will have important long-term effects on
the character of competition; and the quantity, quality, and location of jobs in the sector.
Moreover, many analysts who watch the automotive industry closely wam that the
ag=mssive offshore investment that we are seeing today wiil create conditions of severe
excess capacity in the near- and medium-term. A major ?post-globalization shakeout?
could permanently alter the competitive landscape of the industry and have disastrous
consequences for the employees of the f- that lose.
This paper provides a discussion the issues that have been raised by the project?s
research so far. The fmt phase of the field research has consisted of a series of on-site
interviews at automaker and Tier 1supplier headquarters in Europe, Japan, Kore%and the
United States. The headquarters interviews have focused on four themes: 1)new market
identilcation and facility planning 2) automaker-supplier relations both at home and
abroad; 3) the commonWon of vehicle, componen~ and process design; and 4)
geographic variations in methods of worker recruitmen~ training, and work organization.
A second phase of the research, to be completed in 1998, will involve visits to selected onand
off-shore production sites. At the time of this writing, we have completed the first
phase of the research in the United States and Europe. Since the headquarters interviews in
Japan and Korea have not yet been conducted, the following discussion will inevitably be
canted toward the perspective of American and European firms. Futiemnore, some of the
data that we will provide are not yet complete, and are presented in draft form.
The paper is organized in four sections. Section One presents the typology of
locations that the project has developed as a way to make sense of the data we collect.
Section Two presents the empirical case: the geographic spread of automobile production.
Section Three discusses some of the factors that are driving the new investment, especially
slow growth and increased competition in established markets. Section Four outlines the
strategic responses of automakers to the increased risk and operational complexity caused
by the globalization process itself. |
| first_indexed | 2024-09-23T11:28:54Z |
| id | mit-1721.1/685 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T11:28:54Z |
| publishDate | 2002 |
| record_format | dspace |
| spelling | mit-1721.1/6852019-04-12T08:09:19Z The Globalization of Automobile Production Sturgeon, Timothy Florida, Richard automotive industry production globalization auto makers This paper is based on research from an in-progress project on the effect of globalization on competition and jobs in the automotive industry.3 Its purpose is to gain a clearer picture of the emerging economic geography of automobile production. The project has found that automakers and their Tier 1suppliers are aggressively internationalizing their operations in search of new markets and lower production CONS. At the same time, the largest automakers are attempting to centralize the product development and corporate control functions of their organizations in their home locations, where they are wor~ng more closely than ever with Tier 1 suppliers. we believe that both the centrifugal and centripetal aspects of the ?globalization? prwess will have important long-term effects on the character of competition; and the quantity, quality, and location of jobs in the sector. Moreover, many analysts who watch the automotive industry closely wam that the ag=mssive offshore investment that we are seeing today wiil create conditions of severe excess capacity in the near- and medium-term. A major ?post-globalization shakeout? could permanently alter the competitive landscape of the industry and have disastrous consequences for the employees of the f- that lose. This paper provides a discussion the issues that have been raised by the project?s research so far. The fmt phase of the field research has consisted of a series of on-site interviews at automaker and Tier 1supplier headquarters in Europe, Japan, Kore%and the United States. The headquarters interviews have focused on four themes: 1)new market identilcation and facility planning 2) automaker-supplier relations both at home and abroad; 3) the commonWon of vehicle, componen~ and process design; and 4) geographic variations in methods of worker recruitmen~ training, and work organization. A second phase of the research, to be completed in 1998, will involve visits to selected onand off-shore production sites. At the time of this writing, we have completed the first phase of the research in the United States and Europe. Since the headquarters interviews in Japan and Korea have not yet been conducted, the following discussion will inevitably be canted toward the perspective of American and European firms. Futiemnore, some of the data that we will provide are not yet complete, and are presented in draft form. The paper is organized in four sections. Section One presents the typology of locations that the project has developed as a way to make sense of the data we collect. Section Two presents the empirical case: the geographic spread of automobile production. Section Three discusses some of the factors that are driving the new investment, especially slow growth and increased competition in established markets. Section Four outlines the strategic responses of automakers to the increased risk and operational complexity caused by the globalization process itself. the Alfred P. Sloan Foundation. 2002-06-06T18:27:07Z 2002-06-06T18:27:07Z 2002-06-06T18:27:08Z http://hdl.handle.net/1721.1/685 en_US 944590 bytes application/pdf application/pdf |
| spellingShingle | automotive industry production globalization auto makers Sturgeon, Timothy Florida, Richard The Globalization of Automobile Production |
| title | The Globalization of Automobile Production |
| title_full | The Globalization of Automobile Production |
| title_fullStr | The Globalization of Automobile Production |
| title_full_unstemmed | The Globalization of Automobile Production |
| title_short | The Globalization of Automobile Production |
| title_sort | globalization of automobile production |
| topic | automotive industry production globalization auto makers |
| url | http://hdl.handle.net/1721.1/685 |
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