The Pursuit of Original Equipment Manufacturer Strategy: Insights from an Asian Country

Abstract

The automotive sector is the major industry of Thailand's economy. This paper discusses the national strategy of Thailand toward the Detroit of Asia. In particular, the study analyses the pursuit of original equipment manufacturer (OEM) strategy in the Thai automotive industry, based on Porter's Diamond Model. A qualitative approach was adopted, using semi-structured interviews to understand the reasons behind Thailand's adoption of OEM strategy and its decisions in not following other strategic approaches. The findings provide important lessons to other developing economies in terms of adopting the right strategies to improve the national performance and competitiveness. The case of Thailand is clearly evident that the Thai government chooses not to develop its own brand (OBM strategy) but pursue the OEM path to strengthen its automotive industry.