Emerging transnational manufacturers from the Central European periphery: the case of Polish automotive companies

Publication Type:

Conference Paper


Gerpisa colloquium, Paris (2021)


Central Europe, core and periphery, Industrial upgrading, Poland, transnational manufacturers


The rapid growth of Central European economies has been related to inward foreign direct investment and these countries are often regarded as dependent market economies, which rely on capital and technologies provided by foreign transnational corporations. What is an interesting recent phenomenon is the international expansion of some domestic-owned manufacturing companies from Central Europe. The paper aims to identify paths and mechanisms of development of Polish automotive firms expanding in the global markets through acquisitions and greenfield investments in Western Europe, North America, and Asia. The authors ponder on the underlying motives and barriers of this process, the capabilities and features of Polish-owned companies as well as the impact on their position in global production networks. Emerging Polish multinationals are discussed through the lens of global production networks approach combined with firm-specific and country-specific capabilities. The international expansion of domestic-owned firms is interpreted as a specific critical conjuncture of three paths: 1) development of Central European economies since the end of communism, 2) the evolution of the Western European core, especially since the global financial crisis of 2008-2009, and 3) the trajectory of individual Polish firms. It is argued that the development trajectories of the firms going global cannot be understood without taking into account the dynamic interdependence between firm-specific capabilities and the changing characteristics of the countries, e.g. evolving regional assets. The combination of traditional cost advantages with high organisational adaptability allowed some firms to identify the window of opportunity which appeared in the aftermath of the financial crisis and take advantage of this opportunity. The question is to what extent this affects broader processes of industrial, functional and social upgrading of the automotive sector in the country. The immediate effect is that manufacturers from the EU’s periphery achieve a stronger market position with brand names and distribution networks they control in the core economies of Western Europe and emerging economies of Asia and Latin America. They gain more power in global production networks by taking a step forward from a comparative advantage based primarily on low labour costs towards enhanced non-production competences via functional upgrading. Furthermore, peripheral manufacturers escape the vicious circle of low economies of scale and lack of decision-making, marketing and design capabilities, which have hindered their upgrading in global production networks thus far. The effects of the acquisition of Western European companies on the development of non-production competences can vary. On the one hand, this may enhance the technological capabilities of Polish manufacturers through the transfer of know-how and personnel, but on the other hand, R&D and design may still be carried out at Western European subsidiaries rather than in Poland. At the same time, the number of firms successfully expanding in international markets and their size are still very limited. There is a permanent threat of a foreign takeover of successful Polish firms, which face new organizational, financial and technological challenges in global markets. The authors discuss the possible impact of contemporary trends of electrification, digitalisation and the COVID-19 crisis on the future prospects of Polish multinationals.


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