ABSTRACT
This chapter explains how today’s dominant automakers achieved their oligopolistic power, with only ten companies controlling over 75 percent of global production. Moreover, it delineates the technological and economic reasons for continued industrial concentration in this increasingly competitive industry. Further it asserts that the leading automakers from developed countries are not the only ones involved in M&A. Ambitious cash-rich lower-tier automakers from the developing countries are also using acquisitions as a means of not only acquiring market share but also much needed branding, distribution, technical and marketing capabilities which would have taken them decades to develop. More importantly, it explains how these powerful forces (in the form of a cascade effect) result in increasing industrial concentration even among their assigned suppliers, who have effectively become their ‘lieutenants’ in the global automotive value chain.
