Transition of the automotive industry towards electric vehicle production in the east European integrated periphery

• Published in: Empirica Vol. 50; no. 1; pp. 35 - 73
• Main Author: Pavlínek, Petr
• Format: Journal Article
• Language: English
• Published: New York Springer US 01-02-2023; Springer Nature B.V
• Subjects: Alternative fuel vehicles; Automobile industry; Comparative advantage; Competition; Competitive advantage; Division of labor; Econometrics; Economics; Economics and Finance; Electric vehicles; European Integration; Foreign companies; Foreign investment; Industrial Organization; International Economics; Labor costs; Macroeconomics/Monetary Economics//Financial Economics; Motor car industry; Original Paper; Production; Production costs; Public Finance; Value chain; Vehicles; Europe; Eastern Europe; Automotive industry; Global production networks; F23; Foreign direct investment; Electric vehicles; L62; Global value chains
• ISSN: 0340-8744; 1573-6911
• DOI: 10.1007/s10663-022-09554-9

This article analyzes the progress of the transition from the production of vehicles with internal combustion engines to the production of electric vehicles in eastern Europe. The transition is considered in the context of the development of the automotive industry in eastern Europe since the early 1990s and the relative position of the east European integrated periphery in the European automotive industry value chains and production networks. The article argues that foreign firms are driving the transition, while the role of the east European governments and local firms is much less significant. The transition is slower than in western Europe and eastern Europe will continue to produce internal combustion engine vehicles longer. Eastern Europe will continue to rely on its competitive advantage of low production costs, especially low labor costs, to continue to attract foreign direct investment in the automotive industry. The article considers the consequences of the transition for the position of east European countries in automotive value chains, production networks and the division of labor in the European automotive industry.