Cost-competitive places: shifting fortunes and the closure of Dell’s manufacturing facility in Ireland

Abstract

In the early days of 2009 the city of Limerick in the mid-west region of Ireland was dealt a massive blow by the PC manufacturer Dell. After months, if not years, of speculation, the company had finally decided to move all its European manufacturing from Limerick to Lodz in Poland. Among the many reasons cited – from the global economic downturn to a shifting market – cost-competitiveness became the clear determining factor. The media coverage was extensive, with the headline ‘Dell Closes’ bandied about in the national and regional press. Though of little consolation to the 1900 left without a job, the fact remains that Dell has not closed its Limerick operation, where it will continue to employ upwards of 1000 in sales support and research and development. We use the Dell story as an exemplar of the Irish foreign direct investment (FDI) story. Comparing it with other restructurings by foreign-owned technology companies both in Ireland and beyond we will attempt to uncover the complexity of shifting competitiveness and competencies among branches of global operations. Although the case of Dell, among others, may serve to support the political economy view of large multinational corporations, we see the picture as being more complex and rely on literature relating to global production networks (GPNs) in attempting to uncover the shifting spatial dynamics of cost-competitiveness.