An Exploratory Study on Upgrading by FDI OEMs in China

The paper utilizes the perspectives of global value chain and dynamic capabilities to explore how FDI original equipment manufacturers (OEMs) implement functional upgrading to compete in China’s booming market. This research first develops a conceptual framework that identifies the specific capabilities (technological, manufacturing and absorptive capabilities) and leadership style involved in the upgrading trajectory by FDI OEMs, and then employs a multiple-case study with pattern-matching analysis investigating two Singapore-invested OEMs to examine the assumed model. By collecting first-hand timely data, the results have important practical implications for FDI OEMs, as they can help these firms to grow and prosper in the Chinese market.