Automobiles: a key manufacturing industry

Abstract

Chapter 17 focuses on the automobile industry as a familiar, large-scale, globalized exemplar of manufacturing industries in general. It begins with the widespread use of cooperative strategies at the corporate level—whether using a corporate brand, building a family of brands that can use common innovation, platforms, and parts, or pursuing specific markets through alliances, the automotive industry offers a variety of cooperative strategies. The chapter then looks specifically at the use of joint production and supply agreements, a practice that is universal in the auto sector and has grown steadily as it has matured. Finally, it addresses market entry alliances to build and sell (and sometimes to design) cars—and perhaps to manage competition—in foreign markets. The chapter also addresses the issue of alliance versus acquisition in manufacturing before closing with a look at changes coming from the rapid growth of emerging markets.