Volkswagen's Way East - Brownfield or Greenfield Investments

Seminar paper from the year 2007 in the subject Business economics - Business Management, Corporate Governance, grade: 1,3, BI Norwegian Business School, language: English, abstract: In terms of a rising competitive environment the way east gets more and more important. It does not only lead to a reduction in costs but operating in the eastern parts of Europe can result in advantages for the whole company. Volkswagen overtook their JV partner Skoda and this gave them access to the local cluster. This is an advantage, that companies which do not invest in brownfield investments do not have right from the beginning. Therefore, the kind of FDI and the region are very important and can determine the companies future success. Volkswagen's greenfield investment in Kaluga, Russia will also be explained, based on the advantages and disadvantages that the two different FDI offer. The different VW investments will then be linked to Dunning's eclectic paradigm, the OLI model.