Emerging Auto Industries in a World of Global Value Chains:Industrial Policies and Development Strategies

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This presentation introduces a forthcoming edited volume on the topic. Overall, the volume explores how the global automotive industry is changing and what the main drivers of transformation are; what new actors are setting the stage, including countries, firms and institutions; what developmental strategies they are pursuing and what obstacles they are encountering.

Building on the experiences of auto industrialisation in a wide range of emerging economies, the volume offers an extensive empirical base to understand the real challenges of GVC-led industrialisation, their policy implications and their meaning for local development. It includes numerous country cases, in different continents: Poland and Hungary in Eastern Europe; Brazil and Argentina in Latin America; Morocco and South Africa in Africa; Thailand, India, China and Vietnam in Asia.

These help substantiate a series of crucial theoretical reflections, on different integration patterns, on the value of institutions, on firm internationalisation strategies, on labour regimes and technological change within GVCs. Together, empirical and theoretical chapters also allow to make sense of the big transformations that are affecting the industry, and of electrification in particular, from an emerging economies perspective.

Building on the wealth of cases analysed in the book, this presentation illustrates why industrialising via the development of an automotive industry is still an ambition for many late industrialisers/ developing countries, regardless of the substantial challenges faced by the global automotive industry. Despite the international competitive pressure, the unwritten future linked to the ongoing twin transition (ecological and digital) and the recent crisis of the EV market, the automotive industry remains an important employer, and a crucial source of inter-sectoral linkages and domestic spillovers. From a development perspective, and despite the inherent ecological trade-offs, it cannot be easily dismissed, and it will still be relevant for years to come.

More specifically, this presentation reflects on the experience of GVC-integration from the viewpoint of late auto industrialisers. Referring to Pavlinek’s latest classification (2025, in this volume), it firstly discusses different types of possible integration. It then reflects on conditions for successful integration, and on factors that may hamper it. It particularly draws on cases like Poland, Morocco, Thailand, South Africa and Vietnam, to illustrate different varieties of integration, or lack of it, and their developmental implications.

Ultimately, through the lenses of GVC-integration, the work presented here reflects on different industrial policy trajectories and available policy tools, on factors like geography and resource endowment in relation to productive specialisation, on developmental trade-offs, and on global reconfigurations we may expect in the world automotive industry in the near future.

References:

Monaco, L. and Schroeder, M. (eds) (forthcoming, 2025) Emerging Auto Industries in a World of Global Value Chains – Actors, Policies, Structural Issues, Palgrave.

Pavlinek, P. (2025, forthcoming) The Development of the Automotive Industry in Less Developed Countries, ch. 3 in Monaco, L. and Schroeder, M. (eds) (forthcoming, 2025) Emerging Auto Industries in a World of Global Value Chains – Actors, Policies, Structural Issues, Palgrave.