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Globalization and the Death of the Local Firm? The Automobile Components Sector in South Africa

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  • Justin Barnes
  • Raphael Kaplinsky

Abstract

BARNES J. and KAPLINSKY R. (2000) Globalization and the death of the local firm? The automobile components sector in South Africa, Reg. Studies 34 , 797-812. As in the case of many developing countries, South African industry is facing a new competitive environment as trade barriers fall. This involves both the need to enter external markets and to cope with new entrants in the domestic market. In the case of the South African automobile assembly industry, responding to this new global environment has increasingly meant that domestic subsidiaries are being integrated into the global strategic operations of their parent companies. This is increasingly leading them to the foreign sourcing of components, in part because of perverse and unintended consequences of the Motor Industry Development Plan. Where local production of components is involved, there is decreasing space for locally-owned component suppliers and almost no space for component suppliers using local technology. South African component suppliers are thus increasingly being relegated to highly competitive niches in mature technologies in external after-markets, making them vulnerable to exchange rates. BARNES J. and KAPLINSKY R. (2000) La mondialisation et la mort de l'entreprise locale?: les equipementiers en Afrique du Sud, Reg. Studies 34 , 797-812. Comme c'est le cas dans beaucoup des pays developpes, l'industrie en Afrique du Sud affronte un nouveau climat competitif au fur et a mesure du demantelement des barrieres tarifaires. Cela implique le besoin de prendre pied sur les marches exterieurs et de faire face aux nouveaux investisseurs etrangers qui arrivent sur le marche interieur. De plus en plus, repondre a ce nouveau climat international veut dire pour les equipementiers en Afrique du Sud l'integration croissante des filiales dans les activites strategiques internationales de leur maison-mere. Petit a petit, cela a entraine la recherche de fournisseurs etrangers pour se procurer des pieces detachees, en partie a cause des consequences illogiques et non voulus du Plan en faveur du developpement de l'indutrie automobile. La ou la production locale de pieces detachees est en jeu, il y a moins de possibilites pour les equipementiers autochtones et pas de possibilites presque pour les equipementiers qui se servent de la technologie locale. Par la suite, les equipementiers en Afrique du Sud se voient releguer de plus en plus aux creneaux tres competitives des technologies mures dans des marches secondaires externes, ce qui les rend vulnerables aux taux de change. BARNES J. und KAPLINSKY R. (2000) Globalisierung und das Ende der einheimischen Firma? Der Automobilkomponentensektor in Sudafrika, Reg. Studies 34 , 797-812. Wie viele Entwicklungslander, sieht sich auch Sudafrika bei der Aufhebungvon Handelsschranken einerneuen Wettbewerbslage gegenuber. Es ergibt sich sowohl die Notwendigkeit, in auswartige Markte einzusteigen, als es auch mit den neuen Einsteigern im einheimischen Market aufzunehmen. Im Falle der sudafrikanischen Automobilmontageindustrie hat die Reaktion auf diese neue globale Lage dazu gefuhrt, dass einheimische Tochtergesellschaften in die globalen strategischen Betriebsplane ihrer Muttergesellschaften einbezogen werden. Dies fuhrt sie zunehmend zu auslandischen Bezugsquellen fur einzelne Maschinenteile, zum Teil wegen abwegiger und unbeabsichtigter Folgen des Entwicklungsplans der Automobilindustrie. Wo es um einheimische Herstellung einzelner Maschinenteile geht, ist immer weniger Raum fur in einheimischem Besitz befindliche Maschinenteillieferungen und fast gar kein Raum fur auf ortsansassige Technologie gestutzte. Sudafrikanische Maschinenteillieferanten werden somit zunehmend in stark wettbewerbsbestimmte Situationen in voll entwickelten Technologien in auslandischen Kundendienstmarkten abgeschoben, wobei sie den jeweiligen Wechselkursen wehrlos ausgesetzt sind.

Suggested Citation

  • Justin Barnes & Raphael Kaplinsky, 2000. "Globalization and the Death of the Local Firm? The Automobile Components Sector in South Africa," Regional Studies, Taylor & Francis Journals, vol. 34(9), pages 797-812.
    • Handle: RePEc:taf:regstd:v:34:y:2000:i:9:p:797-812
    DOI: 10.1080/00343400020002949
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    References listed on IDEAS

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    1. David Sadler, 1999. "Internationalization and Specialization in the European Automotive Components Sector: Implications for the Hollowing-out Thesis," Regional Studies, Taylor & Francis Journals, vol. 33(2), pages 109-119.
    2. Kaplinsky, Raphael & Morris, Mike, 1999. "Trade Policy Reform and the Competitive Response in Kwazulu Natal Province, South Africa," World Development, Elsevier, vol. 27(4), pages 717-737, April.
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    2. Petr Pavlínek & Jan Ženka, 2016. "Value creation and value capture in the automotive industry: Empirical evidence from Czechia," Environment and Planning A, , vol. 48(5), pages 937-959, May.
    3. Mañé Estrada, Aurèlia & Soldevila Lafon, Maria Victòria & Cámara Arilla, Carmen de la & Puig Gómez, Albert, 2012. "New stakeholders, spaces and instruments of analysis in the context of energy relationships: Case studies from Kazakhstan and Turkmenistan," Working Papers 2072/203154, Universitat Rovira i Virgili, Department of Economics.
    4. Peter Draper & Andreas Freytag & Sören Scholvin & Luong Thanh Tran, 2016. "Is a ‘Factory Southern Africa’ Feasible?," World Bank Publications - Reports 23788, The World Bank Group.
    5. Moritz Breul & Javier Revilla Diez, 2021. "“One thing leads to another”, but where? – Gateway cities and the geography of production linkages," Growth and Change, Wiley Blackwell, vol. 52(1), pages 29-47, March.
    6. Simona, Gentile-Lüdecke & Axèle, Giroud, 2012. "Knowledge Transfer from TNCs and Upgrading of Domestic Firms: The Polish Automotive Sector," World Development, Elsevier, vol. 40(4), pages 796-807.
    7. Lila Truett & Dale Truett, 2006. "Production and costs in the South African motor vehicle industry," Applied Economics, Taylor & Francis Journals, vol. 38(20), pages 2381-2392.
    8. Akçomak, Ibrahim Semih & Bürken, Serkan, 2019. "The middle-technology trap: The case of the automotive industry in Turkey," MERIT Working Papers 2019-006, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    9. Lorentzen, Jochen, 2005. "The absorptive capacities of South African automotive component suppliers," World Development, Elsevier, vol. 33(7), pages 1153-1182, July.
    10. Peter Draper & Andreas Freytag & Sören Scholvin & Luong Thanh Tran, 2016. "Is a 'Factory Southern Africa' Feasible? Harnessing Flying Geese to the South African Gateway," CESifo Working Paper Series 5867, CESifo.
    11. Jason F. Bell & Lorenza Monaco, 2021. "Power and supply chain development in the South African and Thai automotive industries: What lessons can be learnt?," Journal of International Development, John Wiley & Sons, Ltd., vol. 33(3), pages 457-471, April.
    12. Ross D. Weiner & Trevor Roxo & Mitchell Kellman, 2008. "South Africa's Manufactured International Trade in the Post-Sanctions Epoch: Patterns and Potentials," The American Economist, Sage Publications, vol. 52(1), pages 86-95, March.
    13. Morris, Mike & Kaplinsky, Raphael & Kaplan, David, 2012. "“One thing leads to another”—Commodities, linkages and industrial development," Resources Policy, Elsevier, vol. 37(4), pages 408-416.
    14. Hoshino, Taeko, 2015. "Boundaries of firms and catching up by latecomers in global production networks : the case of a Mexican auto-parts manufacturer," IDE Discussion Papers 492, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    15. Lila J. Truett & Dale B. Truett, 2009. "Firm Size And Efficiency In The South African Motor Vehicle Industry," Australian Economic Papers, Wiley Blackwell, vol. 48(4), pages 333-341, December.
    16. Justin Barnes & Anthony Black & Kriengkrai Techakanont, 2017. "Industrial Policy, Multinational Strategy and Domestic Capability: A Comparative Analysis of the Development of South Africa’s and Thailand’s Automotive Industries," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 29(1), pages 37-53, January.
    17. René m. Bakker & Leon A.g. Oerlemans & Tinus Pretorius, 2008. "Domestic And International Innovation Partnerships: Do They Matter For Innovation Outcomes Of South African Firms?," South African Journal of Economics, Economic Society of South Africa, vol. 76(3), pages 518-536, September.
    18. Matthias Brönner & Skander Salah & Markus Lienkamp, 2020. "Production Challenges in Least Developed Countries," Challenges, MDPI, vol. 11(1), pages 1-20, January.
    19. Petr Pavlínek & Pavla Žížalová, 2016. "Linkages and spillovers in global production networks: firm-level analysis of the Czech automotive industry," Journal of Economic Geography, Oxford University Press, vol. 16(2), pages 331-363.
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    21. Javier Bilbao-Ubillos, 2010. "Spatial Implications of New Dynamics in Production Organisation: The Case of the Automotive Industry in the Basque Country," Urban Studies, Urban Studies Journal Limited, vol. 47(5), pages 1117-1146, May.

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