Closing the gap: the Chinese electric vehicle industry owns the road

Abstract

PurposeAfter three decades of development, the Chinese electric vehicle industry became the world’s largest electric vehicle market in 2015. However, little is understood about how the Chinese electric vehicle industry, as a latecomer in this strategic newly emerged industry, could catch up with international incumbents. The purpose of this paper is to study how the windows of opportunity emerge and interactively influence the catch-up process of Chinese electric vehicle industry.Design/methodology/approachThis paper conducted a case study to examine how Chinese electric vehicle latecomers use the windows of opportunity along with the development of a sectoral system of innovation to reduce the gaps.FindingsThe results indicate that windows of opportunity appeared in the introduction stage (2005) and the transition from the introduction stage to the growth stage (2015) because of the sectoral changes in technologies, demand, policies and the interaction among these factors. Domestic electric vehicle latecomers currently follow the catch-up pattern of duplication, creative imitation and innovation.Practical implicationsTo capture the previous windows of opportunity, domestic electric vehicle latecomers rely on technology transfer through international joint ventures, government support and local advantages from cheap labor. To seize future windows of opportunity, apart from progressively accumulating innovation capabilities, it is also essential for managers to recognize, break through and extend the windows of opportunity by anticipating and monitoring the process of changes of the sectoral system.Originality/valueThis paper provides a fine-grained study on how latecomers in a new industry with emerging markets can seize windows of opportunities to catch up with the international leaders.