Managing Innovation in a Changing Industry: The Role of SMEs in the European Automobile Sector

The automobile industry is experiencing dramatic shifts which are impacting on the technological and organisational innovation in the sector. The related implications require the attention of scholars, policy makers, and various stakeholders for their effect on the economy and society as a whole. We adopt the Open Innovation concept to examine some of the effects of these transformations because it provides an overarching framework that has the potential to encompass various research streams and concepts, including outsourcing, collaboration, and networks. The study investigates the role of SMEs in the rapidly changing landscape of the European Automobile Industry through interviewing purposely selected respondents across seven European countries. The findings demonstrate that despite the efforts of regional authorities, SMEs in the car industry are largely restricted in their development choices by lack of adequate funding, limited access to expertise and technology, and rigid industry structure.