Strategies of Automobile Multinational Firms in Mexico and GVC

Type de publication:

Conference Paper


Gerpisa colloquium, Paris (2012)


automobile industry, Mexico


“Strategies of Automobile Multinational Firms in Mexico and GVC” Jorge Carrillo (COLEF) and Oscar Contreras (COLEF) (MEXICO)

The broad theoretical discussion of automobile multinational corporations (AMNCs) and their impact on host country development reveals a significant proportion of controversy. Opinions on the impact of AMNCs proliferate, but it is necessary to present evidence based on carefully conducted empirical studies. An assessment of the involvement of subsidiaries operating in Mexico can see the extent to which industries are organized, regional development and territorial strategies and the implications of these processes to improve the impact of FDI through create jobs with higher value added and higher earnings.

The purpose of this paper is to document the type of involvement with AMNCs in the Global Value Chain for carrying out operations in Mexico. Although it is generally accepted that the export sector plays a crucial role in economic growth in Mexico, and numerous studies prove it, the extent to which international trade and operations of multinational corporations can be the basis of a sustainable economic development long term has been questioned. This research tries to make a more precise level of business operation and not as is usually done at aggregated data.

Multinational companies, domestic and foreign, are analyzed from a MNC firm census based on telephone interviews made in 2008, and from a face-to-face survey with HR managers in 2009. The survey is statistically representative of multinational companies established in Mexico. It will compare the auto MNCs and other manufacture MNCs operating in Mexico.

The main goal is to identify the key investment strategies of automobile multinational corporations in Mexico from official sources and, in particular, from the study "Multinational Firms in Mexico: A study on the structure organizational innovation and employment practices."

Define the investment strategies of multinationals is not a simple task because the definition itself of multinational can be very complex. The stages of internationalization in the case of Mexico are quiet important in the definition: the multinational as subsidiary, as export affiliated or global exporter. From these phases, four strategies are identified as major determinants of investment activities by multinational enterprises (Dunning, 1993, Behrman, 1972): a) Natural Resource-seeking, b) Market-seeking, c) Efficiency-seeking and d) Strategic assets-seeking or technological assets.

This paper analyzes automobile multinational companies, domestic and foreign, in all different sectors, from the four strategies mentioned. It uses a multinational census based on phone interviews and a survey face-to-face with HR managers of multinational firms established in Mexico during 2009.

The hypothesis is the following: in Mexico the automobile multinationals have specialized in the strategy of seeking efficiency through export, where it is expected that these companies keep a better position both in the global value chain as in their impact on working conditions compared to those manufacture companies whose primary investment strategy vary.

Behrman, Jack (1972), “Industrial Integration and the Multinational Enterprise”, The ANNALS of the American Academy of Political and Social Science, No. 403, pp.46-57

Dunning, John H. (1993), Multinational Enterprises and the Global Economy, Reading, Mass. y Wokingham, England, Addison Wesley.

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