The diffusion of synthetic materials in the automobile industry: Towards a major breakthrough?

Abstract

This paper examines the role of synthetic materials with regard to the technological changes in the automobile industry. Synthetic materials have substantially improved fuel economy, especially reducing vehicle weight. Furthermore, they allow simplification of both cars and productive processes and a more frequent change in the range of models supplied. Nevertheless, the substitution of steel has been relatively slow. Some factors hinder the adoption of plastics, mostly the existence of technical obstacles, the lack of appropriate skills, and relevant improvements in steel technology. Still, the establishment of regulations and technical standards could greatly affect competition among materials. The findings of the paper have been related both to threshold models of diffusion and to technological substitution models. It is concluded that these models offer an unsuitable framework to effectively understand the case study investigated. Corporate strategy is discussed in the final section. It is pointed out that a new area of research and production, linking the chemical and the automobile industries, is quietly developing. While chemical firms are looking for increased downstream integration, for automobile firms, the need to internalise know-how on synthetic materials technology acts as a formidable push towards greater backward vertical integration. However, some country-specific and firm-specific factors do emerge.