Study On The Vertical Disintegration Of Multinational Corporations

The environment of multinational corporations development has greatly changedsince the end of the20th century, with the rapid development of science and technologyrevolution. Main show is standard parts production and supply presents are replaced bysemi-finished products module production and supply. Market supply and demand ismore and more strong uncertainty; the speed of the upgrading of products has be greatlyaccelerated, life cycle is shortening constantly. In the new situation, the verticalintegration strategy praised by many large multinational companies is facing more andmore limitations. In order to strengthen the flexibility of the enterprise management, themultinational companies of automotive, electronics, communications and many otherindustries began to take the initiative to adjust industry chain, move out some of thelower margins of the industry chain, and develope the enterprise the most competitivefields. The vertical separation of Multinational corporations production chain appere as anew phenomenon of economic development.Vertical separation of multinational companies includes three aspects: Verticalseparation of multinational companies is the changes from the reality of the border to thevirtual boundary, is the process of the enterprise network organization formation, is theprocess of the vertical specialization production of corporate. In recent years,multinational company’s vertical separation trend presents three characteristics: thedevelopment speed is accelerated apparently; developed countries developing countriesstarted earlier but fast development; high technology industry is higher than that ofvertical separation of low technology industry.Transnational corporation perpendicular separation phenomenon has a profoundreason, can use the enterprise core competitiveness theory to explain. Under the newhistorical conditions, the formation of the cross enterprise production network, brings thenew dominant position to the enterprise which is different from the vertical integration.Mainly includes three aspects: enterprise has obtained the production flexibility throughthe implementation of vertical separation and network construction, enterprise focus itsbusiness through the external transfer of production processes; centralized network within the advantage of the enterprise to create the most competitive products.Transnational corporation perpendicular separation changed by the development ofthe global economic development path, Global trade structure has new characteristics andtrends under the influence of the vertical separation, Main show is production chainvertical trade forward acceleration, high-tech development. Transnational corporationperpendicular separation in strengthening transnational corporation on industriallongitudinal control, as bring opportunity to the developing country industrydevelopment. In addition, the vertical separation promote the development of producerservice industry.As a higher degree of opening state, China has been influenced by the developmentof transnational corporation changes in production, bring " Matthew effect" to theindustry upgrades of our country. aggrandized the longitudinal control of verticalproduction chain, aggravate Low level expansion of foreign trade in our country. Facingthe opportunity and challenge by multinational corporation vertical separation to ourcountry economy development, our country should be based on the initiative adjustment,take the following measures: Improve the level of opening; Establish the risingmechanism of the Industry; Develop Economic Development Zone; Improve the level ofregional intensive development; Improve the capacity of regional independent innovation;Build the sustainable development environment.