Research Questions - Nicolas Hatzfeld

Internationalisation : a few Points

How can we characterize the issues at stake for the automobile industry? A << sequential >> presentation shows two successive periods: the 1980's which were characterized by a change in the industrial model, and the 1990's dedicated to a new wave of redeployment and internationalization corresponding to a return in strength of volume. Such a succession is often reflected in the dominant discourse of companies, at least in America and Europe. Renault, whose management had dismissed this strategy until recently, has also adopted it. It remains to be examined, on the one hand if that corresponds to a real succession of these strategies, and according to what chronology; and on the other hand if the companies have really brought their results closer, as such a succession would suppose. For example, if the rapprochement is real as far as quality is concerned, it is debatable in the domain of productivity.

The question of productivity is in itself a possible area of research: factories, direct productivity has experienced growth and, most probably a rapprochement of companies, and the main differences are probably to be found in the differences in manufacturability, at design level. In this domain, European car manufacturers seem to have few results; this would merit a specific study. The text, itself, looks at competitiveness at a wider and finally more strategic level, which also encompasses factors which are external to companies, such as exchange rates.
The internationalization movement must not be looked at in a cut and dry manner:

- If it is a global trend, it does not necessarily concern all countries. Some countries may not << develop >>, or may only do so in a very marginal way. Only China and India could, because of their size, weigh heavily in the balance with growth which would remain weak and differentiated;

- Protection schemes still exist. The European Union has a regime of protection that it certainly intends lessening according to a timetable; but it is an unfinished process. Developing countries too, often protect themselves, and have not always clearly decided how they intend to grow, by opening up or by staying national. There are differences between world regions, an example being that countries in Asia seem to attach much more importance to reexportation than Latin America.

- It would be good to make out a typology of these different forms of protection according to region; to product, components or finished product; using a method which would base itself on tariffs, regulation measures; or finally according to what extent they open up, in a bilateral or in a wider way. The companies' strategies follow the evolution laid down in the regulations, sometimes in different ways. For example the lifting of Australian trade barriers, brought about the departure of the Nissan factory, but not Toyota, which is reexporting to the United States. Another example would be the implantations made in Turkey with a view to entry in the European Community.

Suppliers are affected by the increase in internationalization. First of all, the wave of concentration that this sector is experiencing is a direct consequence. Then their relations with the manufacturers are modified. As far as the volume of activity is concerned, evolution will surely be limited: the relationship between suppliers/ manufacturers, for the production of a vehicle, is already 70%/30%. But the nature of the relationship can change. Thus modular manufacturing tends to be developing. From a historical point of view that could be interpreted as a return to the automobile industry,s initial form, as this had first been partly modular before passing under the hegemony of the leading manufacturing companies.

What forms of organization can this evolution lead to? Two possible orientations can be envisaged: Either the manufacturer maintains global control of the product and its implementation; or the product becomes commonplace, as the suppliers take control of their sub-groups, and the manufacturer reduces its specific share, in the image of franchise relations that exist in other industries. It is still too early to say how this new trend of modular manufacturing will affect manufacturer/ supplier relationships. These are linked to the margins envisaged: Restricted volumes with big risks making modularity attractive, while large volumes with little risk, encourage one to keep as much activity as possible internal.