Ford and the Global Strategies of Multinationals: The North American Auto Industry

Ford and the Global Strategies of Multinationals: The North American Auto Industry

Ford and the Global Strategies of Multinationals: The North American Auto Industry

Ford and the Global Strategies of Multinationals: The North American Auto Industry


This is an analysis of how the global strategies of Multi-national Enterprises (MNE's) affect the power relationship between MNE's and states in the context of increasing trans-national economic integration. It features an in-depth study of the Ford motor company and case studies of the Mexican and Canadian motor industries.



Economic integration and globalization are processes that describe the fundamental changes taking place in the international system. A reduced role for the State in economic affairs, both internationally and nationally, and an increasing centrality of non-State actors appear as concomitant developments of those changes. Very little can be discerned about these changes without understanding the role of the multinational enterprise (MNE).

Although hardly a new actor in the international scene, today the MNE is perceived as having acquired a growing relevance that makes it a leading agent in restructuring the international economy. While it is generally accepted that it does not replace the nation-state as the main actor in the international system, in some extreme views the MNE has actually seized some of the traditional functions of the State. As they adopt global strategies, MNEs are seen to be creating stronger, deeper, and more lasting linkages among countries and gaining tremendous power to shape outcomes in the so-called global economy. From this perspective, the balance of power has shifted inexorably from the State to the MNE.

Paradoxically, despite the pre-eminence that MNEs have gained in a more open world economy, mainstream theories of international relations and international political economy, which have largely centered on the State, have failed to incorporate the study of the MNE as a purposive actor. Also, despite the role of the MNEs in creating globally integrated systems of production, most explanations for cross-border integration tend to emphasize government actions in the form of either changes in the regulatory frameworks or formal free-trade negotiations. One could assume that at least in industries where MNEs hold a powerful position, those actors are responsible for creating the conditions that make cross-national integration an option for governments. This book suggests the need for studying MNEs as purposive actors, with goals, strategies, and organizational structures. It then looks at the factors that determine and influence the strategies of MNEs, and explores the conditions under which they contribute to the creation of cross-border integration.

While assuming that the MNE has become a power broker with which States must contend, this book argues that economic cross-border integration, which is allegedly promoted by the global strategies of the MNEs, does not necessarily imply a shift in the balance of power between MNEs and States in favor of the former and to the detriment of the latter for at least two main reasons.

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