Diversification of International Trade as Competitive Advantage: Case of Automotive Industry in Central and Eastern Europe

By Lukas Mohelsky.

Published by The Global Studies Journal

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Article: Print $US10.00
Article: Electronic $US5.00

Internationalization is one of the most important forces reshaping the competitive business environment of today. The implications of the increasing volume of the international trade for the competitiveness on the national, industrial and entrepreneurial level are far reaching. The role of the international trade and its growth has been particularly remarkable in the recent history of the automotive industry within the Central and Eastern European (CEE) region, which includes the Czech Republic, Hungary, Poland and Slovakia. The CEE countries have been increasing their shares on the European production of the motor vehicles and their components, even though the local demand has so far remained only limited. The goal of this study is to analyze the development of the customers’ portfolio of the automotive components’ exporters in the Czech Republic, Hungary, Poland and Slovakia from the perspective of their international location. The underlying hypothesis tested throughout the analysis is that the increasing export volume raises the international diversification and thus helps the CEE countries to achieve a competitive advantage. The conclusion of the study provides ambiguous results and clearly indicated that the development in the Central and Eastern Europe can’t be assessed as cohesive, as every country is subject to specific conditions. The underlying hypothesis of the study can only be confirmed in case of Poland and Slovakia. The Czech and Hungarian export did not improve its level of diversification, as it remained limited on a narrow range of countries located mostly within the European Union. However, the limitations of the study must also be considered and attention must be paid to its premises. The article provides significant opportunities for further research, particularly from the global perspective.

Keywords: Diversification, International Trade, Automotive Industry, Central and Eastern Europe

Global Studies Journal, Volume 5, Issue 2, pp.157-170. Article: Print (Spiral Bound). Article: Electronic (PDF File; 391.668KB).

Lukas Mohelsky

PhD. Candidate, Faculty of International Relations, University of Economics, Prague, Czech Republic

I am a young researcher with experience from both academic and business sector. I graduated with Magna Cum Laude in International Business from the University of Economics in Prague, Czech Republic, and I gained valuable international experience during my long-term stays in Taipei, Taiwan, and in Seoul, South Korea. I am currently pursuing the PhD. degree in International Economic Relations at the University of Economics in Prague. As my academic research is focused mainly on the automotive industry, my professional career has been also aimed at this sector. At the moment, I am responsible for the international projects of Skoda Auto (subsidiary of Volkswagen) in its product management division.

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