Browse Publications Technical Papers 2000-05-0218

Modularity, industrial condominiums and modular consortium: A new form of organization of the production chain in the Brazilian automotive industry 2000-05-0218

Assembler-suppliers relations in the automobile industry have been structurally transformed. Brazil is the home of the most radical experience, the modular consortium at VW Resende truck plant, where suppliers carry out all assembly operations. Almost all the major players have already facilities in the country, and newcomers are setting it attracted by a large potential market in a well-known, western-style business environment.
Based on a research conducted in eight assembly plants in Brazil (7 industrial condominiums and 1 modular consortium) and in several suppliers, the paper aims to discuss the transformations and trends of assembler-suppliers relations by analyzing the dynamic frontrun. Brazil as pointed out above, is a key case, even in terms of product development ("emerging markets car," like Fiat Palio and General Motors Corporation Blue Macaw). The definition of industrial condominium and modular consortium is discussed; these arrangements are different from "industrial parks" and from the Japanese way of relationship (inside a keiretsu). Then, we argue that an industrial condominium is characterized mainly as a service relation: a) resolution of quality problems; b) to cope with changes in scheduling due to vulnerabilities of the assembler''s operations/forecast; c) ideas for continuous improvement.


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