Suppliers Involvement Strategies in Flex Fuel Vehicle Development

Abstract

The flex-fuel car is a commercial success in Brazil. This innovation illustrates two different strategies of supplier involvement in technology development: black-box and gray-box or co-design. This paper presents two cases studies of how two mature Brazilian automakers subsidiaries (Volkswagen and General Motors) undertook the development of flex-fuel technology. We also present the development's context, which led to the technology wide spread adoption. Then we discuss the possible impact of both involvement strategies on dependence relations between automakers and their module suppliers, suggesting they will not change large trends toward more, even if limited, dependence on complex high technology modules or "systemist" suppliers.