New Path Development in a Semi-peripheral Auto Region: The Case of Ontario

Abstract

The automotive industry is facing disruptive trends and great uncertainty. The path forward for automotive jurisdictions is uncertain in terms of how automakers will allocate the production of new connected and autonomous vehicles (C/AVs). The introduction of C/AV technologies creates high levels of uncertainty both for individual firms and regional innovation systems (RISs). The intersection of established production competencies with emerging digital technologies raises questions about how regional pathways and RISs develop and how local and RISs adapt to changes in global innovation networks. Building on recent contributions to evolutionary economic geography (EEG), the article examines the impact of the current technology transition on Ontario’s automotive sector. Drawing on rich empirical data and recent conceptual advances in theorizing about new path development from EEG and the literature on global innovation networks, the article casts light on how the intersection between global innovation networks and regional actors is altering Ontario’s developmental path. It examines the potential for Ontario to diversify away from its historic status as a semi-peripheral automotive region with limited investment in research and development to one with a greater role in the emerging paradigm of connected and autonomous vehicles. The article explores the potential for path diversification based on interpath dynamics between the region's auto and information and computer technology sectors as well as the importance of both system-level and firm-level agency for altering the region's developmental trajectory.