Racing to the top? Catch-up strategies of Chinese and Indian independent car manufacturers Online publication date: Thu, 28-Nov-2013
by Gert Bruche; Daniel Wäldchen
International Journal of Automotive Technology and Management (IJATM), Vol. 13, No. 1, 2013
Abstract: The study examines the attempts of five independent automobile latecomer firms (BYD, Chery, Geely, Tata Motors, Mahindra & Mahindra) to catch-up with their rivals from advanced economies. While catch-up speed is influenced by the country-specific context, the firms' capability acquisition is generally based on leveraging directly accessible resources of advanced automotive firms (e.g., through reverse engineering, supplier involvement, in-licensing, or small scale M&As), and on progressively developing independent design and manufacturing skills. In this stage, international sales are confined to other developing countries only. After the initial fast catch-up trajectory, the firms' incremental learning and capability building processes come up against a more challenging 'catch up barrier'. The acquisitions of Jaguar Land Rover and Volvo by Tata Motors and Geely can be seen as attempts to 'leapfrog' over this otherwise lengthy and uncertain 'last mile' of the catch-up process.
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