The geographical restructuring of the European automobile industry in the 2000s

Frigant, Vincent and Miollan, Stéphane (2014): The geographical restructuring of the European automobile industry in the 2000s.

Abstract

The paper seeks to provide a quantitative and macroeconomic picture of the new geography of the automotive industry in Europe. Since ten new members joined the European Union in 2004, automakers and suppliers have changed their location strategies and now view the whole of Europe as a single fully integrated space. Using data on employment, production, trade and foreign control of affiliated firms, the paper measures the East-West relocation process. The first section studies the motor vehicle sector, highlighting a sharp rise in the activity levels of Central and Eastern European countries (CEEC), as well as the specific role that Germany plays. It is crucial to remember that motor vehicle manufacturing remains a key traditional economic activity for some of the larger Western European countries. The second section looks at the automotive parts sector. The CEECs’ growth is particularly impressive when consideration is given to employment, a variable largely driven by foreign firms’ decision to export much of their local production. At the same time, the offshoring process remains more or less selective even if it often revolves around labour-intensive activities – explaining in turn the creation today of embedded East-West networks.

• Item Type: MPRA Paper
• Language: English
• Keywords: automobile; Europe; deindustrialisation; relocation; offshoring; industry geography; auto parts industry
• Subjects: F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms ; International Business; F - International Economics > F6 - Economic Impacts of Globalization > F62 - Macroeconomic Impacts; L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L23 - Organization of Production; L - Industrial Organization > L6 - Industry Studies: Manufacturing > L62 - Automobiles ; Other Transportation Equipment ; Related Parts and Equipment; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R12 - Size and Spatial Distributions of Regional Economic Activity

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