Automotive Industry Strategies by CEE Governments: Who Does What to Attract Business?

Springer, Reiner & Chadraba, Petr (eds.): Proceedings of the 20th Annual Conference on Marketing and Business Strategies for Central & Eastern Europe December 6-8, 2012, Vienna, Austria, pp. 373-389

16 Pages Posted: 1 Nov 2013

See all articles by Peter R. Haiss

Peter R. Haiss

WU Vienna University of Economics and Business; UniCredit Bank Austria; IES Vienna - Institute for the International Education of Students

Zalán Balási

Vienna University of Economics and Business

Christine Meissl

Vienna University of Economics and Business

Date Written: December 8, 2012

Abstract

Location decisions by automotive firms can play a major role in the economic development of whole regions and countries, both via direct stimuli (employment, education, innovation etc.) as well as pulling in further investments by suppliers and related industries. What strategies did governments in Central and Eastern Europe (CEE) apply to attract automotive industries to invest? How do government incentives fit the EU competition policy, and which worked? Based on location theory (Feinberg, 2007) and Porters' (1990) competitive advantage, we discuss measures taken by CEE governments. We conduct country case studies for Bulgaria, Hungary and Romania and analyze government incentive programs which were implemented for 5 recent large-scale investments by original equipment manufacturers. In comparing these public strategies, we conclude that tax related polices are among the most frequently used, while state grants and guarantees and the provision of infrastructure are also prevalent. Similar to shopping mall developers, governments try to attract “key investors” in the hope that upon this anchor, other investments will follow. This puts early movers in a formidable position.

Keywords: automotive industry, Eastern Europe, public support, car subsidies, competitiveness

JEL Classification: L62; L14; L21

Suggested Citation

Haiss, Peter R. and Balási, Zalán and Meissl, Christine, Automotive Industry Strategies by CEE Governments: Who Does What to Attract Business? (December 8, 2012). Springer, Reiner & Chadraba, Petr (eds.): Proceedings of the 20th Annual Conference on Marketing and Business Strategies for Central & Eastern Europe December 6-8, 2012, Vienna, Austria, pp. 373-389, Available at SSRN: https://ssrn.com/abstract=2347105 or http://dx.doi.org/10.2139/ssrn.2347105

Peter R. Haiss (Contact Author)

WU Vienna University of Economics and Business ( email )

Institute for Production Management
Welthandelsplatz 1
Vienna, A-1020
Austria
++43-660 4848254 (Phone)
++43-50505 8944214 (Fax)

UniCredit Bank Austria ( email )

Rothschildplatz 1
Vienna, A-1020
Austria
++43-(0)50505 44214 (Phone)
++43-(0)50505 89 44214 (Fax)

HOME PAGE: http://www.bankaustria.com

IES Vienna - Institute for the International Education of Students

Johannesgasse 7
Vienna, A-1010
Austria

Zalán Balási

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, Wien A-1020
Austria

Christine Meissl

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, Wien A-1020
Austria

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
77
Abstract Views
568
rank
339,704
PlumX Metrics