The Significance of Domestic Outsourcing of Production in the Korean Automotive Industry - through comparison with Japanese “Itaku” production-

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Abstract:

This paper intends to investigate the Domestic Outsourcing of Production in the Korean automotive industry, and to explore what is the implication of this new phenomenon, through comparison with those of Japan.
Reviewing hundreds of literatures about automotive industry in this field, interdependent heterogeneous division relationships between automobile manufactures and suppliers have been main stream objects so far.
However, from the practical viewpoint, we could not ignore the presence of homogeneous division relationship, especially on explaining rapid expansion of Japanese automotive industry over the past 40 years.
Recently Korean Kia Motors who belongs to Hyundai Motors group has started outsourcing of compact cars’ production into Donghee Auto who is the joint concern of Donghee group and Kia Motor.
I examine the significance of this new attempt in Korean automobile industry compared with Japanese “Itaku”production　that ranges even development of new models, from this following 3 perspectives.