The configuration and evolution of Korean automotive supply network: an empirical study based on k-core network analysis

Abstract

This study identified the hierarchical structure of the k-core network and examined how it changed over time by structurally analyzing the Korean automotive supply network. The k-core method is a useful subgroup analysis for identifying key nodes through a pruning process in a large and complex network such as the automotive industry. We used the information of 234 automotive parts suppliers listed in the “Automotive Industry Guide”. The supply network is divided into four subgroups, where at the center is the 4-core group with key nodes, surrounded by the next key group of the 3-core group. Around the 3-core group is the 2-core group, and at the periphery of the network is the 1-core group. Unlike in the traditional supply chain structure, all core groups include 1st, 2nd, and 3rd tier suppliers. In addition, it is confirmed that the k-core structure has a complementary relationship with the tier structure and degree centrality, and considering the three together, the key node could be identified in the network. Finally, an analysis of the evolution of the network revealed that most new suppliers entered the 1-core group, and those in the top k-core group had a higher remaining ratio. The significance of this study is 1) by presenting k-core, a new method to analyze the network structure, 2) confirming the structure and evolution of the actual supply network from a macroscopic perspective, and 3) identifying key suppliers that can directly or indirectly affect the company's performance.