Strategies of Internationalisation of Automobile Firms in the New Century : A New Leap Forward

The first purpose of this chapter is to analyse this internationalization push by extending the sample to 22 major automobile firms and carefully assessing their geographical reach to check if there is a real globalization process. We use a statistical approach that tries to measure the degree of internationalization of automobile firms for the period 2000-2005 . In so doing, we refer to the analytical framework of the “productive models” (Boyer, Freyssenet 2002) according to which there are two conditions to sustainable profitability: (1) A relevant profit strategy and (2) the establishment of a “company government compromise” which establishes a coherency between certain requirements that the firm’s players (executives, shareholders, banks, employees, trade unions, suppliers, the State) must satisfy. Because this “company government compromise” is first established at the national level, and continues to play a vital role for the firm’s survival, we still consider the national level as the starting point of our investigation. We then turn to the regional level to assess the relative importance of intraregional and extra-regional activities of the firm. The implicit assumption is that a global firm must develop an important part of its activity outside its region of origin.The second purpose of this chapter is to study the profit that firms make abroad. Due to data availability this second part will be limited to American and Asian firms. But this is still sufficient to provide answers to some questions: Do firms succeed in making big profit abroad, or do they register losses, or in other terms is producing and selling abroad a bonanza or a curse? We do not pretend to judge definitely if a profit strategy linked to a productive model is successful or not because a lot of different factors are involved in explaining the year on year profit and loss. The following chapters that analyse in-depth some of the firms under review will bring more comprehensive explanations. But at least we will provide some indications. On the long-term, a successful profit strategy should materialise in substantial profits