G. Waitt, SAY BYE TO HYUNDAI AND HI TO KOREAN AUTOPARTS - RESTRUCTURING THE KOREAN AUTOMOBILE-INDUSTRY IN THE 1990S, Tijdschrift voor economische en sociale geografie, 84(3), 1993, pp. 198-206
This article examines the industrial restructuring process of the Repu
blic of Korea's automobile industry. The basic framework for the analy
sis is provided by the theory of competitive advantage. Rather than co
mpetitive advantage being a function of place, it is a result of a set
of conditions constructed within a place. Factors which are essential
to the production system; world market conditions, corporate structur
e, the nature of the product and production process, as well as govern
ment policies are stressed. Whilst government intervention successfull
y restructured industry to create an export market for automobiles in
the mid-1980s, export growth planned for autoparts may not occur in th
e 1990s. Exports of small, low cost passenger cars was achieved in the
North American market because the Korean government could intervene i
n the production process in several ways with the objective of reducin
g cost. Price was central to consumer preference in the mass-produced
car market. In contrast, high-technology autopart markets are differen
tiated by technology and quality. Government intervention necessary to
establish research and development facilities to promote autopart exp
orts may not overcome the limitations of the autopart corporate struct
ure, the general lack of finance and skilled scientists in the Republi
c of Korea, as well as the impacts of 'democratisation' on industrial
policy-making.