ABSTRACT
This chapter analyzes the international production strategies taken thus far and explores what course this internationalization trend is likely to take in the future. It discusses a relationship pattern describing the characteristics of various automakers in their international production and procurement strategies and study their direct production operations overseas. In contrast to cases where one company uses another independent company’s production facilities with little or no capital participation, a full-fledged acquisition enables the new owner to implement its own management strategy with complete freedom and maximum effectiveness. Contracted production usually take the form of a foreign automaker providing capital and/or technology or joint research & development to a local automaker in exchange for producing cars to be sold under the foreign automaker’s brand. By contrast, in contracted production, the client is always involved to some extent in developing the products it receives from the contracted company.
