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The effects of follow sourcing on local suppliers: an exploratory study of the automotive industry in Brazil
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Resumo(s)
Rapid changes in the area of supply chain management in the last twenty years formed a whole new
approach towards doing business. As one of the most affected industries by those recent changes, the
automotive industry adjusted its approach towards global supply chains and internationalization
drastically. New opportunities in a global environment led to new sourcing strategies and Brazil as one
of the youngest automotive markets integrated theses changes quickly. One of the new arising sourcing
practices in the automotive industry during the last two decades is a phenomenon named “follow
sourcing”, which describes the parallel network establishment of supplier and manufacturer around the
globe. Suppliers started to following manufactures to foreign markets and fight local suppliers in their
own territory. This paper explores the effects of follow sourcing practices on local suppliers of the
automobile industry in Brazil. Therefore, this study follows an exploratory qualitative approach in form
of a single case study. In order to gather the necessary data a series of interviews were conducted with
mainly CEOs of the industry or related businesses. The findings show the immediate and long-term
effects differ drastically. Main effects of follow sourcing on competition and positioning of local
suppliers in the Brazilian automotive industry were discovered and a theoretical framework was
developed to clarify these effect during different periods in time.
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Palavras-chave
Supply chain management Automotive Brazil Follow sourcing