The automotive industry is Europe’s leading sector and transmitter of innovations and cyclical trends. However, the increasing competition from newly industrialized developing countries and transition countries, the saturation of markets, the reduction of trade barriers and the global economic crisis have caused profound changes since the 1990s. In reaction to structural downturns, Original Equipment Manufacturers (OEMs) focused on their strategic and operational core competencies, such as product development, process engineering, brand management, and coordination of global value chain. Unprofitable and high-risk functions have been outsourced to subsidiaries, suppliers and service providers (DICKEN 2004, 357pp.). Initially, only productions and sales were decentralized to low-cost countries and emerging markets. In the meantime, parts of research and development (R&D) as well as design functions have likely been affected by internationalization. This restructuring has opened up new opportunities for semi-peripheral locations . Foreign Direct Investments (FDI), intra-corporate knowledge transfer and local innovation strategies enable selected regions to build up technical and organizational knowledge and competencies. This leads to modifications of the classical and highly simplified division of competencies in global value chains, characterized by the localization of complex and knowledge-intensive capacities in the triad and the localization of wage and labour-intensive ranges in newly industrialized developing countries and developing countries. Instead, we observe a greater variability in the international division of competencies. Research on the impact of transnational corporations for regional learning is usually conducted in newly industrialized developing countries. Yet, the analysis of knowledge acquisition in the automotive industry is evenly important for regions in transition countries, which are also popular destinations for FDI. Cross-border activities by transnational corporations may potentially induce upgrading processes in global value chains in terms of product, process and functions in semi-peripheral regions (HUMPHREY/SCHMITZ 2004, 95pp.; 2000). In this context, important interactions take place between organizational and regional actors. These interactions include OEMs, suppliers of different levels, R&D centres, the public sector and other actors, and may lead to innovative products and processes as well as the acquisition of new competencies. Upgrading enables subsidiaries to achieve higher positions in value chains and provokes changes in the international division of labour and competencies. The aim of this paper is to develop a conceptual framework explaining the different options of corporate competency division and their regional effects in terms of decentral competency acquisition. The framework is empirically based on an analysis of the Volkswagen Commercial Vehicles group and Delphi Automotive Systems with their affiliated companies in Poland. The conclusion is drawn that the traditional division of competencies in the automotive industry is replaced by a new scope of variation which includes prospects for local competency acquisition and upgrading in terms of product, process and functions.
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