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Is diversification a Strategic Advantage? The Example of Automotive Components in the Czech Republic

Lukas Mohelsky () and Hana Machková

Central European Business Review, 2012, vol. 2012, issue 2, 37-45

Abstract: The automotive industry is a key sector of the Czech national economy. Its share of GDP represents more than 8% and the Czech Republic is the 14th biggest producer of personal cars in the world. The goal of this article is to analyze the development of the customer portfolio of automotive suppliers in the Czech Republic from the perspective of their international location. The diversification of the portfolio can be measured in many ways. The approach in this article relies both on the usual statistical tools (concentration ratio, Lorenz curve, Gini coefficient, Herfindahl-Hirschman index) and on specific approaches such as the number of partners, geographical diversification and average distance travelled by exported component. Even though the export volume has been dynamically growing, it has remained focused on a limited number of crucial countries, which are mostly located in the close neighborhood of the Czech Republic.

Keywords: diversification; strategic management; automotive industry (search for similar items in EconPapers)
JEL-codes: L2 L62 (search for similar items in EconPapers)
Date: 2012
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Faculty of Business Administration, University of Economics, Prague

DOI: 10.18267/j.cebr.16

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