Comparative Advantages Analysis: Car Manufacturing in Germany and South Korea

Bolin Yan

doi:10.62051/b7x2ww60

Authors

Bolin Yan

DOI:

https://doi.org/10.62051/b7x2ww60

Keywords:

Porter's Diamond Model; Car Manufacturing Industry; Germany; South Korea.

Abstract

In Germany and South Korea, both countries have comparable strengths in the automotive manufacturing industry and both have a significant position, contributing greatly to GDP growth, employment, and upstream and downstream industries. This paper analyses the advantages of South Korea and Germany through the Porter's diamond model, analysing six aspects: factor conditions, demand conditions, related and supporting industries, firm strategy, structure and rivalry, government and chance. The result showed that Germany has invested heavily in research and infrastructure, while South Korea is better in responding flexibly to the world's turbulent situation and in the field of new energy vehicles.

Downloads

Download data is not yet available.

References

[1] McKinsey (2024) Autonomous driving’s future: Convenient and connected. Available at: https://www.mckinsey.com/~/media/mckinsey/industries/automotive%20and%20assembly/our%20insights/autonomous%20drivings%20future%20convenient%20and%20connected/autonomous-drivings-future-convenient-and-connected_final.pdf (Accessed: 24th June 2024)

[2] Bechmann, R., Scherk, M. (2010). ‘Globalization in the Automotive Industry–Impact and Trends’. Globalization 2.0. pp177-192

[3] IBIS World (2024) Global Car & Automobile Manufacturing - Market Size, Industry Analysis, Trends and Forecasts. Available at: https://www.ibisworld.com/global/market-research-reports/global-car-automobile-manufacturing-industry/#IndustryStatisticsAndTrends (Accessed: 15th June 2024)

[4] Verband Der Automobilindustrie (2020) Significance of automotive industry for Germany. Available at: https://www.vda.de/en/topics/automotive-industry/significance-of-automotive-industry-for-germany#:~:text=Significance%20of%20automotive%20industry%20for%20Germany%201%20Industrial,the%20most%20research%20...%206%20Strongest%20exporter%20 (Accessed: 16th June 2024)

[5] Yülek, M. A., Lee, K. H., Kim, J., & Park, D. (2020). 'State Capacity and the Role of Industrial Policy in Automobile Industry: a Comparative Analysis of Turkey and South Korea'. Journal of Industry, Competition and Trade 20(2) pp307–331.

[6] Statista (2023) Value of automotive exports from South Korea from 2000 to 2022. Available at: https://www-statista-com.surrey.idm.oclc.org/statistics/947324/south-korea-automotive-export-value/ (Accessed: 16th June 2024)

[7] Steers, R. M., & Shim, W. S. (2020). 'Korean-style leadership: a comparative perspective'. Asian Business & Management 19(2) pp175–178.

[8] Porter, M. (1990) 'The competitive advantage of nations', Competitive Intelligence Review. 1(1) pp14-20.

[9] Statista (2024) Internal expenditure for research and development in the car industry in Germany from 2011 to 2022. Available at: https://www-statista-com.surrey.idm.oclc.org/statistics/589335/car-industry-germany-research-and-development-expenses/ (Accessed: 16th June 2024)

[10] Statista (2024) Internal expenditure for research and development in the car industry in South Korea from 2011 to 2022. Available at: https://www-statista-com.surrey.idm.oclc.org/statistics/589332/car-industry-south-korea-research-and-development-expenses/ (Accessed: 16th June 2024)

[11] Carbonbrief (2015) Global survey: Where in the world is most and least aware of climate change? Available at: https://www.carbonbrief.org/global-survey-where-in-the-world-is-most-and-least-aware-of-climate-change/ (Accessed: 18th June 2024)

[12] Statista (2024) Market share of electric vehicles in Germany from 2014 to 2023. Available at: https://www-statista-com.surrey.idm.oclc.org/statistics/1166826/electric-vehicles-market-share-germany/ (Accessed: 19th June 2024)

[13] Statista (2024) Market share of electric vehicles in South Korea from 2014 to 2023. Available at: https://www-statista-com.surrey.idm.oclc.org/statistics/1099571/south-korea-electric-vehicles-market-share/ (Accessed: 19th June 2024)

[14] Invest Korea (2024) Korea's Future Car Industry, Continual Growth by Actively Responding to Domestic and Global Changes. Available at: https://www.investkorea.org/ik-en/bbs/i-308/detail.do?ntt_sn=490792&clickArea=enmain00019 (Accessed: 20th June 2024)

[15] Statista (2020) Road network worldwide 2020, by country. Available at: https://www-statista-com.surrey.idm.oclc.org/forecasts/1150796/road-network-by-country (Accessed: 20th June 2024)

[16] Clauß, M., & Pinnau, S. (2022). Determining the impact of climate change on road infrastructure in Germany. 1st edn. CRC Press

[17] Nieuwenhuis, P., & Wells, P. (Eds.). (2015). The global automotive industry (1st ed.). John Wiley & Sons, Inc.

[18] World Energy (2020) German Government Raises Subsidy Levels for EVs. Available at: https://www.world-energy.org/article/9801.html#:~:text=The%20German%20government%20will%20raise%20the%20level%20of,costing%20up%20to%20€40%2C000%2C%20until%2031%20January%202021. (Accessed: 24th June 2024)

[19] Contify Automotive News (2021) Mercedes-Benz receives world’s first internationally valid system approval for conditionally automated driving. Athena Information Solutions Pvt. Ltd.

[20] Harvard Business Review (2024) 3 Drivers of China’s Booming Electric Vehicle Market. Available at: https://hbr.org/2024/01/3-drivers-of-chinas-booming-electric-vehicle-market (Accessed: 24th June 2024)

[21] Valdovinos, S., Barbrack, C., & Podest, N. (2023). 'Are Autonomous Vehicles Really “Autonomous?”: The Importance of Human Factors in AV Safety'. Proceedings of the Human Factors and Ergonomics Society Annual Meeting, 67(1) pp1602–1605