Building capabilities through global innovation networks: case studies from the Brazilian automotive industry

Abstract

Internationalization of R&D towards developing countries has created innovation network configurations that are truly global. These global innovation networks (GINs) are set up in developing countries for technological or market reasons. Sometimes firms in a country are integrated for market reasons, and are responsible only for the adaptation of products for local conditions, but over time, the very fact of being part of a GIN increases their technological capabilities and they start conducting more significant innovation. In order to examine how this local innovation capability may evolve and what new capabilities are built in the process, we investigated the Brazilian automotive industry. We conducted case studies in subsidiaries of one large European automotive original equipment manufacturer and four automotive systems suppliers. Results confirmed that due to specificities of the local technological learning process, becoming part of a GIN has significantly contributed to enhance local innovation capabilities.