From Joint Ventures to National Champions or Global Players? Alliances and Technological Catching-up in Chinese and Indian Automotive Industries

The internationalisation of the automotive industry inChina and India sheds light on the economic processes ofemergence at large. The modes of endogenisation of technology have shiftedfrom an all-over joint venture route towards the directemergence of provincial players into the global scene andnew forms of alliances. This evolution in the car industryserves as an analyser of the relationships betweenindustrial policies, industrial partnerships and paths oftechnological catching-up that are at the core of thephenomenon of emergence. Chinese and Indian car companies are not onlyinternationalising by selling abroad; they areinternationalising by producing abroad and even, for someof them, globalising their production process throughrethinking their whole supply chain, entering new valuechains, or grasping global opportunities.This paper, based on interviews, examines differentstylised business models for Chinese and Indian carcompanies, to ultimately question the theory of emergingmarket multinationals and of joint ventures. It does so byexamining the following points:- the trajectories of Chinese and Indian carmakers, viz.their property status and relationship to the State(private vs. State owned; province of localisation) in acontext of consolidating national champions;- modes of technological catching-up and innovationprocesses;- market mix strategies between a geographicallyfragmented (in China) or concentrated (in India) domesticmarket and a growing export performance combined with anearly multinational production.The paper concludes on the different trajectories and onperspectives for joint ventures. We notably raise thehypothesis that joint ventures classically based on anexchange of technology for market access have exhausted their scope, and might now have to be based on an exchange of domestic market for international market, or are evolving towards different forms of governance.