Local Firms in Latecomer Developing Countries amidst China's Rise -The case of Vietnam's motorcycle industry-

This paper examines the impact of China's recent rise on the development of local firms in latecomer developing countries. Based on a detailed analysis of Vietnam's motorcycle industry, the paper argues that China's impact may go beyond what a trade analysis suggests. Indeed, China's rise induced a dynamic transformation in the structure of value chains within Vietnam's motorcycle industry, bringing about far-reaching consequences on the development and upgrading trajectories of local firms. The implications of the case study for the wider "global value chain" approach is also discussed.

Value Chain Dynamics and Growth of Local Firms:The Case of Motorcycle Industry in Vietnam

Vietnam’s burgeoning market for motorcycles has attracted global industry eaders,players from developing countries, and local firms. This has led to a dynamic evolution of value chains. This paper presents an explanation of the varieties of the growth patterns xperienced by the local suppliers, focusing on the roles of customer and local supplier strategies. Case studies showed that while the role of customers may be important, strategies of suppliers to improve the ompetitive edge in the production of otorcycle components and to diversify into other products account for important ariations of growth trajectories among local suppliers. Findings presented in this paper suggest the need to direct more attention to strategy that local firms use to boost their competitive edge in business.

Asian Industrial Development from the Perspective of the Motorcycle Industry

This paper discusses the diversity of industrial development among Asian countries that emerges through an investigation of the motorcycle industry despite its uniform industrial attributes. The paper then explores factors that generate diversity, focusing attention on the differences in knowledge-based assets accumulated in each country. It finds that diversity is brought about through the differences in domestic industrial resources and the capabilities of local firms. The analysis underscores each country’s intrinsic logic in industrial development, contrary to the current trend of stressing assimilation through the global production networks of multinational corporations.

Perfecting the Catching-up: The Case of Taiwan's Motorcycle Industry

The final stage of the catching-up process has formidable hurdles. This paper examines the case of Taiwan’s motorcycle industry and shows how latecomers overcame the hurdles. In the early 1990s, the two largest motorcycle makers in Taiwan, Sanyang and Kwang Yang, had completed the catching-up process and became independent from Honda, on which they had technologically depended since the early 1960s. The requisite for independence was acquiring the capacity for product innovation. The two assemblers could cultivate technological capacity by investing abundant resources, which they accumulated in the protected market. It should be noted that although the market was protected and highly concentrated, it was also very competitive. Another condition was the solid local suppliers of parts and components. The local suppliers had also grown under the government’s industrial policies. However, their development beyond imitators can be attributed to their own initiatives.

The Diversity and Dynamics of Industrial Organisation: Transformation of Local Assemblers in the Vietnamese Motorcycle Industry

This paper focuses on an emerging arm's-length form of industrial organisation in the motorcycle industry, which had traditionally been characterised by tightly integrated form of organisation. By engaging in how this new form of organisation that emerged in China was transferred to Vietnam and evolved in the Vietnamese context, this paper seeks to illustrate how the rise of local firms in developing countries is driving the increased diversity and dynamics of industrial organisation in an industry that had previously been dominated by TNCs from developed countries.

Exploring the sources of China's challenge to Japan : models of industrial organisation in the motorcycle industry

In view of the recent rise of China, this paper looks into one of the most important yet relatively overlooked ingredients of the Chinese success: industrial organisation. It will examine the case of the motorcycle industry, in which the rise of Chinese manufacturers even disrupted the established dominance of Japanese industry leaders. Adopting the modified version of the global value chain governance framework, this paper shows that the rise of China has been driven by a distinctive arm’s-length model of industrial organisation, which is in sharp contrast to the conventional captive model that has sustained the Japanese leadership.

The Japanese and Chinese models of industrial organisation : fighting for supremacy in the Vietnamese motorcycle industry

This paper explores the consequences of the emerging rivalry between Japanese and Chinese manufacturers. It focuses specifically on industrial organisation, one of the key factors that underlie the competitiveness of manufacturing industries. The question to be asked is what happens when distinctive models of industrial organisation, coming from Japan and China, clash in a developing country. An in-depth longitudinal analysis of the Vietnamese motorcycle industry adopting a modified version of the global value chain governance theory shows that a decade-long industrial transformation resulted in organisational diversity. The implications of the analysis for the literature on industrial organisation are discussed.