Modularization in the Car Industry

This chapter analyses modularization in the world automotive industry. Modularization has involved architectural changes in product, production, and supplier systems in the industry. As an attempt to understand such multi-faceted, complex processes, this chapter proposes a conceptual framework that sees development/production activities as multiple hierarchies of products, processes, and inter-firm boundaries that are interlinked. Using this framework and drawing on case studies and questionnaire survey data, the chapter examines the ongoing processes of modularization in the industry and argues that tensions exist among the three hierarchies. Such tensions may lead to further changes in product, production, and supplier-system architectures.