ABSTRACT
Economies of scale and scope do not explain the major changes in the multinationalization of auto companies from multidomestic to multilocal. Similarly, we reject the standard chronology of an all-powerful Fordism, only to be replaced by an all-powerful Toyotism. The chapter first differentiates the trajectories to globalization of firms in the three branches of the industry: cars, trucks, and components makers. We emphasize the limits of globalization up to the 1960s. Then we stress four dynamics of these multinationals' participation in the changes of the world economy: the partial localization of R & D, the diversified management of cadres and the labor force, the growing impact of information systems, and the building of global finance capabilities. Finally, the chapter focuses on a series of challenges often neglected by ahistorical approaches to auto multinationals: the role of politics, the growth of co-operation between multinationals and with local firms, the brutality of competition, hence the many cases of failures and exits. Overall, the chapter aims to explain both the auto’s expansion around the world (to places like China, India, Iran or Russia) and the new challenges to the classic auto industry recently posed both by regulators preoccupied by road accidents and environmental damage as well as by new providers of mobility. We examine business in society: transforming host and home countries, building global value chains, but sparking desires for adaptations of products and sales to local conditions and fights for safe, sustainable and decarbonated mobility.
