Europe's Innovation Leadership Could Soon Be a Thing of the Past

Automotive R&D in Emerging Markets
Today, national frontiers have less significance for the automotive industry. While locally produced models remain “bestsellers” in their respective countries, foreign vehicles are becoming more prevalent everywhere.

Globalization forced Germany’s vehicle manufacturers to shift much of their production elsewhere, and now the same trend is occurring in the industry’s research and development (R&D). In order to benefit from the rapid pace of growth in emerging countries like India and China, German original equipment manufacturers (OEMs) need to demonstrate their innovative flair by setting up their own R&D centers at the local level. This is the only way for these OEMs to meet the special market requirements encountered in emerging countries, and to hold their own against these areas’ “local heroes.”