Changes in the Auto Parts Global Value Chain between 2000 and 2018

Keywords:

Abstract:

The Change of GVC of Auto Parts between 2000 and 2018

Toshiyuki Baba

Key wards: “Automobile Production”, “Globalization, Global Value Chain (GVC)”, “Global Supply Chain”, “Supporting Industries”, “Advanced Countries and Developing Countries”, “Industrialization”, “Trade”, “Global Competitiveness Index (GCI)”

1. Purpose of this research
For automobile industry, car-parts and components are very important, for both production and R&D. Without accurate auto parts being designed well automobiles might fail to meet expectations of shape, performance and durability. Without good auto parts manufacturers with the ability to produce trial products of auto parts as designer’s ideas are explored in R&D in time, they might face difficulty in enhancing ideas to improve new types of automobile or to complete a design in short time.
Formerly, it is common for automobile manufactures to procure auto parts and components locally. At present, situation complexly changed by enhancing globalization. The purpose of this research is to observe the change of GVC situation between 2000 and 2018.

2. Data and Method
Analyzing Global Value Chain (GVC), the author uses trade statistics of HS (Harmonized Commodity Description and Coding System, date). HS8708 will be used, which is representative of auto-parts and includes items such as bumpers, seat belts, body parts, brakes, gear boxes, driving-axles, wheels, suspensions, radiators, exhaust pipes, clutches, steering wheels, airbags and other miscellaneous auto parts. The raw data will be extracted from UN comtrade database.
Total number of extracted HS8708 data between 1990 and 2018 is 9,301. The author plans to observe every fifth year of 2000, 2005, 2010, 2015 and latest data of 2018. In order to compare trade values of each different years, deflators to calculate 2018 value is introduced. These deflators are calculated by U.S. Consumer Price Indexes (CPI) extracted from World Bank Open Data Base.

3. GVC situation in 2018
There are 130 countries taking part in GVC of car parts in 2018. Total trade value which is a sum of export values and import values is 828.7 billion US dollars. The 65% is occupied by Top 10 countries. The 1st is USA, and then Germany, China, Mexico, Japan, France, Canada, Spain, Czechia and Italy. The 85% is occupied by Top 20s. To show detail total values and share of each Top 5s as follows; The USA is $117.1 billion (14.1%), Germany is $112.0 billion (13.5%), China is $64.2 billion (7.7%), Mexico is $57.0 billion (6.9%) and Japan is $44.8 billion (5.4%).

3. GVC situation in 2000
There are 161 countries taking part in GVC of car parts in 2000. Total trade value which is a sum of export values and import values is $403 billion in 2018 price. The 80% is occupied by Top 10 countries. The 1st is USA, and then Canada, Germany, Japan, France, United Kingdom, Mexico, Spain, Italy and Belgium. The 91% is occupied by Top 20s. To show detail total values in 2018 price and share of each Top 5s as follows; The USA is $86.9 billion (21.6%), Canada is $42.2 billion (10.5%), Germany is $36.0 billion (8.9%), Japan is 28.0 billion (7.0%), and France is 26.9 billion (6.7%).

4. What are changed between 2018 and 2000?
　 According to this brief analysis, some interesting change had occurred between 2018 and 2000. Firstly, total GVC values expanded two times from $403 billion in 2000 to $830 billion in 2018. This means that global trade of car parts substantially increased in this 18 years. Secondly, there are some emerging countries which rank in Top 10 from lower position. Though China ranks third in 2018, the rank in 2000 was fourteenth. Czechia ranks ninth in 2018, the rank in 2000 was eighteenth. Thirdly, the strategy of GVC varies in each country. In some countries, their exports are extremely exceed their imports. In contrast in some countries, their imports are extremely exceed their exports. The author would like to conduct more detail analysis.