ABSTRACT
This chapter explores the political economy of the automotive industry in Southeast Asia by analysing the relationships between Japanese automotive MNCs, the Japanese government, and the ASEAN countries in order to demonstrate how regional industrial and trade policies have been shaped. Japanese MNCs account for over 80% of the market share in the region and have introduced various production, location, local business, and technology transfer strategies so as to maintain their presence. The Japanese government assists Japanese MNCs in establishing region-wide industrial networks in association with the ASEAN governments. There is an active ASEAN–Japan working group in the automotive industry designed to identify problems and facilitate automotive regional development, such as the fostering of support for industries and the promotion of regional automotive parts complementation. Japanese automotive MNCs, in association with the Japanese government, have been playing a significant role in the establishment of the regional arrangements in Southeast Asia, including AFTA in the 1990s and, most recently, the AEC. This chapter also examines Toyota’s regional production and export strategies as a case study.
