Supplier partnership and intra-industry diversification

: the case of Aston Martin’s Mid-Engine segment

Abstract

Firms that compete in rapidly changing industries, such as the automotive one, frequently establish supplier’s partnership to gain a competitive advantage in the market. As a result, previous studies have examined supplier engagement in the development of new projects and concluded that it has an influence on project cost, development time, and project quality. Despite the relevant findings made by scholars in this regard, literature still lacks on explaining the effect of supplier involvement in the case of moving to a new segment within the same industry (Intra-industry diversification), where dependence on suppliers is intense, due to the novelty of the technology involved. Furthermore, it falls short of demonstrating how the supplier helps to accomplish the diversification drivers. Given that, this dissertation aims to respond to the following question: “How does the Supplier Partnership impacts the process of Intra-Industry Diversification?” For this purpose, a case study on Aston Martin was conducted mostly relying on primary data from interviews. This dissertation indicates that access to supplier capabilities has a favourable impact on product quality, cost, and development time. However, the heavy reliance on the partner's technology, the usage of improper industrial procedures, and the absence of contractual protection are factors that lead to the conclusion, contrary to claims by previous research, that partnerships with suppliers are not a synonym of better performance. This research findings are depicted in a framework that can be utilised in the future to evaluate the influence of supplier collaborations on new products development.

Date of Award	12 Oct 2022
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Ricardo Alexandre Morais (Supervisor)