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Geely: a trajectory of catching up and asset-seeking multinational growth

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  • Giovanni Balcet
  • Hua Wang
  • Xavier Richet

Abstract

China became the largest world automobile market in 2009, following a decade of rapid growth. Foreign carmakers played a central role in bringing in technology, management know-how and marketing capabilities, as well as in building supply chains; while domestic companies, mainly central or local state-owned, established joint ventures with foreign carmakers, which took the lion's share of the Chinese market. However, in the late 1990s, some domestic private companies accessed to this market and experienced rapid growth. In order to discuss the catching up and internationalisation processes of Chinese carmakers, and in particular the crucial relationship between the two processes, this paper focuses on the case study of Geely, which broke both industrial and institutional barriers to access this industry. It experienced various ways of catching up, including technology imitation via reverse engineering, product architecture innovation, and asset seeking acquisitions abroad; as well as various ways of international growth, including export, assembly abroad, market seeking operations, and (again) asset-seeking acquisitions abroad. This case study helps the understanding of catching up of Chinese firms, while offering insights into the competitive strategy of emerging multinationals. This paper explores jointly the trajectories of catching up and of multinational growth.

Suggested Citation

  • Giovanni Balcet & Hua Wang & Xavier Richet, 2012. "Geely: a trajectory of catching up and asset-seeking multinational growth," International Journal of Automotive Technology and Management, Inderscience Enterprises Ltd, vol. 12(4), pages 360-375.
    • Handle: RePEc:ids:ijatma:v:12:y:2012:i:4:p:360-375
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    Citations

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    Cited by:

    1. Zhang, Feng & Zhu, Lei & Xu, Zhi & Wu, Yingying, 2023. "Moving from reverse engineering to disruptive innovation in emerging markets: The importance of knowledge creation," Technovation, Elsevier, vol. 125(C).
    2. Lv, Ping & Curran, Louise & Spigarelli, Francesca & Barbieri, Elisa, 2021. "One country, many industries: Heterogeneity of Chinese OFDI motivations at meso level," China Economic Review, Elsevier, vol. 69(C).
    3. Xavier Richet & Xieshu Wang, 2019. "China and Globalization: Internationalization of Firms and Trade in Services," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 2, pages 3-22.
    4. Andoni Maiza & Ricardo Bustillo, 2018. "Analysis of the relevance of China’s development for main European automotive manufacturing countries," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 45(3), pages 403-424, September.
    5. Krzywdzinski, Martin & Lechowski, Grzegorz & Jürgens, Ulrich, 2018. "L’inéluctable évolution des modèles productifs chez les constructeurs automobiles chinois et indiens," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 12, pages 1-20.
    6. Xavier Richet, 2013. "L'internationalisation des firmes chinoises : croissance, motivations, stratégies," Working Papers halshs-00796197, HAL.
    7. Xavier Richet, 2019. "Geographical and Strategic Factors in Chinese Foreign Direct Investment in Europe," Asian Economic Papers, MIT Press, vol. 18(2), pages 102-119, Summer.
    8. Zheng, Qiuxia & Noorderhaven, Niels & Du, Jian, 2022. "Making the unlikely marriage work: The integration process of Chinese strategic asset-seeking acquisitions," Journal of World Business, Elsevier, vol. 57(3).

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