Development and Changes in Supplier Networks - The Case of Volvo Trucks

Abstract

The period from 1990 until today is characterized by dramatic changes in world economy, politics and in technological development. Not surprisingly, these changes had a clear impact on companies and their supplier networks. In this thesis, the authors in detail study the changes within a supplier network structure and the reasons behind these changes. In order to achieve this purpose, the case study of Volvo Trucks is employed. The main findings are that the changes in Volvo’s supplier network can be explained by looking on interlinked factors, which derive from Volvo, the industrial environment and the world situation. The identified changes are the decrease of the number of direct suppliers, supplier’s increased importance, a changed composition of the network, the changed geographical configuration of the supply base, and changes in the power relations between the customer firm and its suppliers. These changes, in turn, are the result of interplay between the modularization in truck production, the consolidation in the industry, the internationalization of Volvo itself and the increase of its production volumes.