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Asymmetric performance: the market share impact of scale and link alliances in the global auto industry

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  • Pierre Dussauge
  • Bernard Garrette
  • Will Mitchell

Abstract

This study investigates how participating in strategic alliances with rivals affects the relative competitive positions of the partner firms. The paper builds on studies that show significant differences in the outcomes of scale and link alliances. The study argues that the more asymmetric outcomes of link alliances translate into greater changes in the relative market shares of the partner firms, due to unbalanced opportunities for inter‐partner learning and learning by doing. We find support for this argument by examining 135 alliances among competing firms in the global automobile industry, from 1966 to 1995. Copyright © 2004 John Wiley & Sons, Ltd.

Suggested Citation

  • Pierre Dussauge & Bernard Garrette & Will Mitchell, 2004. "Asymmetric performance: the market share impact of scale and link alliances in the global auto industry," Strategic Management Journal, Wiley Blackwell, vol. 25(7), pages 701-711, July.
  • Handle: RePEc:bla:stratm:v:25:y:2004:i:7:p:701-711
    DOI: 10.1002/smj.416
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    Cited by:

    1. Yi-Ju Lo & Tung M. Hung, 2017. "Is a powerful rival a right partner?," Review of Managerial Science, Springer, vol. 11(3), pages 661-690, July.
    2. Chengguang Li & Yadong Luo & Juan Bu & Yinuo Tang, 2023. "The role of networks in international acquisition premiums," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 54(9), pages 1700-1711, December.
    3. Yue Zhao & Ronaldo Parente & Stav Fainshmidt & Steven Carnovale, 2021. "MNE host-country alliance network position and post-entry establishment mode choice," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 52(7), pages 1350-1364, September.
    4. Hanna Hottenrott & Cindy Lopes-Bento, 2015. "Quantity or quality? Knowledge alliances and their effects on patenting," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 24(5), pages 981-1011.
    5. de Man, Ard-Pieter & Luvison, Dave, 2019. "Collaborative business models: Aligning and operationalizing alliances," Business Horizons, Elsevier, vol. 62(4), pages 473-482.
    6. Kafigi Jeje, 2014. "Motives behind Strategic Alliance Formation among Medium-Sized Manufacturing Firms in Tanzania," Journal of Management and Strategy, Journal of Management and Strategy, Sciedu Press, vol. 5(3), pages 76-88, August.
    7. Yanhui Zhao & Roger J. Calantone & Clay M. Voorhees, 2018. "Identity change vs. strategy change: the effects of rebranding announcements on stock returns," Journal of the Academy of Marketing Science, Springer, vol. 46(5), pages 795-812, September.
    8. Wilfred Amaldoss & Richard Staelin, 2010. "Cross-Function and Same-Function Alliances: How Does Alliance Structure Affect the Behavior of Partnering Firms?," Management Science, INFORMS, vol. 56(2), pages 302-317, February.
    9. Lai, Jung-Ho & Chang, Shao-Chi & Chen, Sheng-Syan, 2010. "Is experience valuable in international strategic alliances?," Journal of International Management, Elsevier, vol. 16(3), pages 247-261, September.
    10. Marco Furlotti & Giuseppe Soda, 2018. "Fit for the Task: Complementarity, Asymmetry, and Partner Selection in Alliances," Organization Science, INFORMS, vol. 29(5), pages 837-854, October.
    11. Paolo G. Garella & Martin Peitz, 2007. "Alliances between Competitors and Consumer Information," Journal of the European Economic Association, MIT Press, vol. 5(4), pages 823-845, June.
    12. Garrette, Bernard & Castaner, Xavier & Dussauge, Pierre, 2006. "The need for scale as a driver of alliance formation : choosing between collaborative and autonomous production," HEC Research Papers Series 821, HEC Paris.
    13. Scaringella, Laurent & Burtschell, François, 2017. "The challenges of radical innovation in Iran: Knowledge transfer and absorptive capacity highlights — Evidence from a joint venture in the construction sector," Technological Forecasting and Social Change, Elsevier, vol. 122(C), pages 151-169.
    14. Malik, Tariq, 2012. "Disparate association between alliance social capital and the global pharmaceutical firm's performance," International Business Review, Elsevier, vol. 21(6), pages 1017-1028.
    15. Chou, Ting-Kai & Ou, Chin-Shyh & Tsai, Shu-Huan, 2014. "Value of strategic alliances: Evidence from the bond market," Journal of Banking & Finance, Elsevier, vol. 42(C), pages 42-59.
    16. Baojun Yu & Hangjun Xu & Feng Dong, 2019. "Vertical vs. Horizontal: How Strategic Alliance Type Influence Firm Performance?," Sustainability, MDPI, vol. 11(23), pages 1-14, November.
    17. Chinho Lin & NguyenDong-Thai Dao, 2013. "A System Dynamics Model of Trust, Knowledge Sharing and Stability of Strategic Alliance," Diversity, Technology, and Innovation for Operational Competitiveness: Proceedings of the 2013 International Conference on Technology Innovation and Industrial Management,, ToKnowPress.
    18. Martynov Aleksey, 2016. "Do Strategic Alliances, Acquisitions, and R&D Investments Act as Complements or Substitutes?," Foundations of Management, Sciendo, vol. 8(1), pages 7-20, January.
    19. Zhang-sheng Jiang & Yun-hong Hao, 2013. "Game analysis of technology innovation alliance stability based on knowledge transfer," Computational and Mathematical Organization Theory, Springer, vol. 19(4), pages 403-421, December.
    20. Nakul Parameswar & Sanjay Dhir & Sushil, 2020. "Interpretive Ranking of Choice of Interaction of Parent Firms Post-International Joint Venture Termination using TISM-IRP," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 21(1), pages 1-16, March.
    21. Liu, Chia-Ling (Eunice) & Ghauri, Pervez N. & Sinkovics, Rudolf R., 2010. "Understanding the impact of relational capital and organizational learning on alliance outcomes," Journal of World Business, Elsevier, vol. 45(3), pages 237-249, July.
    22. Chen, Li-Yu & Lai, Jung-Ho & Chang, Shao-Chi, 2022. "Strategic networks, certification, and initial public offerings," International Review of Financial Analysis, Elsevier, vol. 83(C).
    23. Piaskowska, D., 2005. "Essays on firm growth and value creation," Other publications TiSEM 89053610-79c6-4c52-9d1c-6, Tilburg University, School of Economics and Management.

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