RESTRUCTURING AND INTERNATIONALIZATION OF THE EUROPEAN AUTOMOTIVE INDUSTRY
P Pavlinek (2020)
Journal of Economic Geogprahy 20 (2), 509-541
This article draws on Harvey’s theory of uneven development and spatio-temporal fix to conceptualize the changing geography of the European automotive industry based on the spatial profit-seeking strategies of automotive firms. It employs the spatial concept of integrated peripheries, in order to explain the growth of the automotive industry in peripheral regions and its contemporaneous restructuring in existing locations. The empirical analysis is based on 2124 restructuring events of large automotive industry firms in the European Union countries and Norway between 2005 and 2016, and on 91 interviews with foreign automotive industry subsidiaries conducted in Czechia and Slovakia between 2009 and 2015. Large differences in labor costs and other production costs across the European Union explain the growth in the East European integrated periphery and simultaneous restructuring in both traditional core regions and old integrated peripheries in Western Europe. The empirical analysis also confirmed the increasing internationalization and the decreasing role played by large domestic firms in the European automotive industry.
GLOBAL PRODUCTION NETWORKS, FOREIGN DIRECT INVESTMENT, AND SUPPLIER LINKAGES IN THE INTEGRATED PERIPHERIES OF THE AUTOMOTIVE INDUSTRY
P Pavlinek (2018)
Economic Geography 94 (2), 141-165
This article examines the regional development effects of foreign direct investment (FDI) in the integrated peripheries of the automotive industry by analyzing supplier linkages between foreign subsidiaries and domestic firms. It develops the spatial concept of integrated peripheries in core-based macroregional production networks. Conceptually, it draws on the dynamic notion of uneven development in contemporary capitalism, namely, on David Harvey’s spatiotemporal fix and on the global production networks concept of strategic coupling to investigate the mode of articulation of integrated peripheries into macro-regional production networks. Empirically, it analyzes the quantity and quality of supplier linkages in the automotive industry of Slovakia based on unique data collected by the author from both foreign subsidiaries and domestic firms through a survey completed by 133 automotive firms in 2010 and interviews with 50 automotive firms conducted between 2011 and 2015. The empirical analysis uncovered weak and dependent supplier linkages between foreign subsidiaries and domestic firms, which undermine the potential for technology and knowledge transfer from foreign subsidiaries to the domestic economy and positive long-term regional development effects of large FDI by automotive industry corporations in integrated peripheries.
FOREIGN DIRECT INVESTMENT AND THE DEVELOPMENT OF THE AUTOMOTIVE INDUSTRY
IN EASTERN AND SOUTHERN EUROPE
P Pavlínek, R Aláez-Aller, C Gil-Canaleta, M Ullibarri-Arce (2017)
ETUI Research Paper-Working Paper
This working paper provides an overview of foreign direct investment (FDI) in the automotive industry in Eastern Europe and Spain, examining trends and patterns since the 1990s, with a focus on the 2000s and especially the period after the 2008- 2009 economic crisis. It draws on analyses prepared in the context of an ETUI project on developments in FDI after the crisis of 2008 (see Galgóczi et al. 2015).
The first part focuses on Central Eastern Europe (CEE) as an example of an integrated periphery in the automotive industry where the main characteristics of FDI can be seen. Besides a comparative analysis, the author provides a detailed description of the sector’s developments country by country. The paper argues that the 2008-2009 global economic crisis coincided with the end of the period of rapid expansion of the CEE automotive industry that was related to the opening up of CEE to foreign trade and FDI in the 1990s and European Union membership in the 2000s.
The second part of this working paper seeks to analyse the investment decisions of automotive groups with plants in Spain during the years of the Great Recession, focussing on FDI inflows to vehicle assemblers in Spain. The analysis seeks to provide a description of the trends affecting the position occupied by Spanish vehicle assembly plants in Europe.
OCCUPATIONAL DISEASES IN THE AUTOMOTIVE INDUSTRY IN CZECHIA – GEOGRAPHIC AND MEDICAL CONTEXT
J Jarolimek, P Urban, P Pavlinek, D Dzurova (2017)
International Journal of Occupational Medicine and Environmental Health 30(3), 455–468
Objectives: The automotive industry represents the most important industrial sector in Czechia. The objective of this study has been to analyze the occurrence of occupational diseases (OD) in the automotive industry during the period from 2001 till 2014. Material and Methods: Data on OD cases was retrieved from the National Registry of OD. Further, we conducted a survey in automotive companies with focus on occupational health services and positions of the companies in global pro- duction networks (GPNs). An analysis of OD distribution in the automotive industry was performed (age, gender, company size and its role in GPNs, regional distribution of studied companies, and regional unemployment rate), and was accom- panied by assessment of the quality and range of occupational health services. Results: Employees older than 40 years old have nearly 2.5 times higher probability of OD occurrence as compared with employees younger than 40 years old (odds ra- tio (OR) = 2.41, 95% confidence interval (CI): 2.05–2.85). Occupational diseases occurrence probability was 3 times higher for women than for men (OR = 3.01, 95% CI: 2.55–3.55). Occupational diseases incidence rates increased with the size of the company (0 OD/10 000 employees in micro enterprises to 57 OD/10 000 employees in large enterprises). A particu- larly steep rise in OD incidents in the automotive industry was observed in the Plzeň Region between 2001 and 2011. An association between OD incidents and the unemployment rate was not statistically confirmed. Conclusions: A statistically significant increase in OD incidents dependent on company size may be arguably attributed to a higher quality of occu- pational medical services in bigger companies, which ensures better detection and diagnosis of OD. In the Plzeň Region, the rapid increase in OD incidents was mainly caused by a change in the production process of automobile textiles in one factory due to the introduction of a glue containing isocyanates, which are potent allergising agents. This led to an increase in occupational allergic diseases – bronchial asthma in particular.
DEPENDENT GROWTH: FOREIGN INVESTMENT AND THE DEVELOPMENT OF THE AUTOMOTIVE INDUSTRY IN EAST-CENTRAL EUROPE.
P Pavlinek (2017)
Springer International Publishing
This book offers a critical analysis of recent developments in the automotive industry of East-Central Europe (ECE). Economists, industry specialists and national governments have considered the rapid development of the automotive industry in ECE in the past twenty years an unqualified success. This rapid growth has been based on large inflows of foreign direct investment (FDI) from Western Europe, North America, Japan and South Korea, and it significantly contributed to GDP growth, created thousands of new jobs, and completely transformed the previously existing automotive industry in the region. This volume offers an analysis that goes beyond uncritical celebratory accounts of this rapid growth. It is based on original, detailed firm-level research conducted by the author in Czechia and Slovakia between 2009 and 2015 that covered assembly firms and the networks of component suppliers. Theoretically and conceptually, the analysis will draw on the global production networks and global value chains perspectives. Drawing on the original empirical data and on additional available information, this volume concentrates on several important questions related to the development of the automotive industry in ECE in the 2000s
WHOSE SUCCESS? THE STATE–FOREIGN CAPITAL NEXUS AND THE DEVELOPMENT OF THE AUTOMOTIVE INDUSTRY IN SLOVAKIA
P Pavlínek (2016)
European Urban and Regional Studies 23 (4), 571-593
Using the case study of Slovakia, this article considers the role of the state in the rapid growth of the automotive industry in integrated peripheral markets of the global automotive industry. Although this growth has been mainly driven by the investment strategies of automotive lead firms, the state has played an important role by accommodating the strategic needs of foreign capital through neoliberal economic policies. In addition to secondary sources, the empirical research is based on a 2010 survey of 299 Slovak-based automotive firms with a response rate of 44% and on 38 on-site firm-level interviews conducted between 2011 and 2013 and one in 2005. The analysis draws upon approaches in economic geography, international political economy and upon global value chains and global production networks perspectives to argue that the successful development of the automotive industry in Slovakia has been achieved at the expense of its overwhelming dependence on foreign capital and corporate capture. The article considers the potential consequences of dependent industrial development for the domestic automotive industry and its position in the international division of labor.
VALUE CREATION AND VALUE CAPTURE IN THE AUTOMOTIVE INDUSTRY: EMPIRICAL EVIDENCE FROM CZECHIA
P Pavlinek, J Zenka (2016)
Environment and Planning A 48 (5), 937-959
This article investigates how distinct tiers of firms contribute to value creation and value capture in the automotive industry. We employ firm-level indicators to evaluate the value creation and capture of distinct supplier tiers in the Czech automotive industry, while considering differences between foreign-owned and domestic firms. Our analysis suggests that the economic effects of the automotive industry largely depend on its capital intensity and that mostly foreign-owned higher tier firms generate and capture greater value than lower tier firms, which include the vast majority of domestic suppliers.
LINKAGES AND SPILLOVERS IN GLOBAL PRODUCTION NETWORKS: FIRM-LEVEL ANALYSIS OF THE CZECH AUTOMOTIVE INDUSTRY
P Pavlinek, P Zízalova (2016)
Journal of Economic Geography 16 (2), 331-363
The aim of this article is to analyze the linkages between and spillovers from foreign-owned (foreign) to domestic-owned (domestic) firms in the Czech automotive industry. Theoretically and conceptually, our research draws on two strands of literature: spillovers, linkages and effects of foreign direct investment on domestic firms and regional economic development; and literature on global production networks, global value chains and industrial upgrading. Empirical analysis is based upon unique data collected by the authors through a questionnaire completed by 317 foreign and domestic firms in 2009 and on-site interviews with 100 firms conducted between 2009 and 2011. Data analysis has identified a low share of domestic suppliers in the total supplies of Czech-based foreign firms and diverse spillover effects from foreign to domestic firms. Domestic firms vary in their capabilities and absorptive capacity which, along with the particular nature of the contemporary automotive value chain, significantly influence their ability and potential to benefit from linkages and spillovers.
FOREIGN DIRECT INVESTMENT AND THE DEVELOPMENT OF THE AUTOMOTIVE INDUSTRY IN CENTRAL AND EASTERN EUROPE
Pavlínek P (2015)
In: Béla Galgóczi, Jan Drahokoupil, Magdalena Bernaciak (eds) Foreign investment in eastern and southern Europe after 2008: Still a lever of growth? ETUI, Brussels, pp. 209-255.
In an increasingly globalized economy, foreign direct investment (FDI) by transnational corporations (TNCs) is considered a major force in the economic development of less developed economies, including the economies of central and eastern Europe (CEE)(eg Jindra et al. 2009). 1 In the early 1990s, it was argued that a successful ‘transition’to capitalism in CEE would depend on large FDI inflows for triggering the necessary industrial restructuring, modernization and successful economic development (eg Fischer and Gelb 1991; Dunning 1993; EBRD 1993). Consequently, CEE countries were urged to open up their economies to global capital (Gowan 1995). The automotive industry was at the forefront of this FDI-driven development strategy in which foreign TNCs took over the CEE automotive industry through heavy capital investment, restructuring it and incorporating it into European and global production networks in the 1990s and 2000s (Pavlínek 2002a; Pavlínek 2002c; Pavlínek et al. 2009). The goal of this chapter is to analyze FDI in the CEE automotive industry, examining trends and patterns since the 1990s with a focus on the 2000s and especially the period after the 2008-2009 economic crisis.
ŠKODA AUTO: THE TRANSFORMATION FROM A DOMESTIC TO A TIER TWO LEAD FIRM.
Pavlínek P (2015)
In: John R. Bryson, Jennifer Clark and Vida Vanchan (eds) Handbook of Manufacturing Industries in the World Economy, Edward Elgar, pp. 345-361.
The automotive industry is considered to be a key industrial sector of strategic importance because of its size, links to other industries, employment effects and its potential regional development effects through the development of networks of component suppliers. As such, the governments of both developed and developing countries have supported the development of the automotive industry through various measures and economic policies (Dicken, 2011). Between 1990 and 2012, the production of cars in Central and Eastern Europe (CEE) increased 2.5 times to 5.3 million units and that of East-Central Europe (ECE) quadrupled to 3.3 million units. 1 This rapid development was orchestrated by core-based transnational corporations (TNCs) through large inflows of foreign direct investment (FDI). As a result, the automotive industry has become a leading industrial sector in terms of its share of industrial production …
THE IMPACT OF THE 2008–2009 CRISIS ON THE AUTOMOTIVE INDUSTRY: GLOBAL TRENDS AND FIRM-LEVEL EFFECTS IN CENTRAL EUROPE
P Pavlínek (2015)
European Urban and Regional Studies 22 (1), 20-40
This article examines the impact of the 2008–2009 economic crisis on the automotive industry. The uneven nature of the crisis contributed to the gradual shift in production from traditional core areas of the global automobile industry to selected less developed economies. In this context, the paper analyses the firm-level effects of the economic crisis in the Czech and Slovak automotive industries as two examples of automotive industry peripheries that were integrated in the European automobile production system and experienced rapid production increases after 1990. The analysis draws on unique data collected during a survey of 274 Czech-based and 133 Slovak-based automotive firms conducted in autumn 2009 and spring 2010, 98 company interviews conducted with automotive firms in Czechia in 2010 and 2011, and 30 interviews conducted in Slovakia in 2011. Changes in revenues, production and employment during the economic crisis are compared between Czechia and Slovakia, and are analysed according to ownership, the involvement of firms in the automotive value chain and firm size. The article also investigates plant closures and relocations in the Czech and Slovak automotive industries during the economic crisis.