Evolution of Thai Automotive Sector: Implications for Technology Management and Policies

Abstract:

This paper examines how a sectoral innovation system evolves over time and what are the underlying factors by using the Thai automotive sector as a case study. Since the 1960s, Thailand has been a major assembly base of foreign carmakers while the local suppliers were mostly slow and passive learners. Nonetheless, in the late 1990s, foreign carmakers acted as ‘lead’ firms began to invest in R&D and related activities. This induced positive co-evolution in other actors, especially the first-tier foreign suppliers and some local suppliers, in the sectoral innovation systems which, in turn, became stronger, more coherent and product-specific. The research has implications on the concept of sectoral innovation system, corporate technology strategies and government technology and innovation policies.
Keywords: sectoral innovation system, evolution, automotive sector, Thailand, lead firms.