Figure 1. Model of national Porter diamond for the automotive industry
Source: developed by the author [1, 14]
Regarding export-import operations in the industry between Ukraine and Europe,
the following prospects for the development of value added production chains should
be identified. According to Art. 29 Section IV of the Agreement "On the Association
of Ukraine and the EU" [10] specified the procedure for abolition of customs duties
and Art. 35 removal of export or import restrictions. Therefore, in a short term, our
Factors (input)
conditions
Strategy and competition
+ exempt tax regime for foreign partners
+ high activity of small enterprises
+ absence of customs barriers with EU
countries
- low competition, only three companies - car
manufacturer
- presence of the shadow economy sector
- Ukraine's low rating in terms of
transparency and corrupt business
- low level of cooperation between
manufacturers of R & D
- the annexation of Crimea and the conflict in
the East of Ukraine
+ favorable geographic location,
nearby to EU borders
+ 4 transport corridors, 18 sea
ports, 11 river ports, 22 thousand
kilometers of railways, 170
thousand km of roads
+ Cheap wages compared to
European ones
+ low cost of energy for the
production of components
- outdated production capacities
and lack of experience in
conducting business in the
conditions of normal economy
- slow implementation of
innovative business processes
- lack of high-quality social
infrastructure
- discrepancy between quantity
and level of training for the needs
of high-tech production
+ Proximity to the European
consumer market, favorable
conditions for export
+ a large national car market
+ An extensive network of
dealers and service
companies of consumer
components
+ Opportunity to sell cars
through tender purchases of
governmental and non-
governmental organizations
- High standards of quality
and requirements of buyers
- the absence of direct
contracts for the supply of
components
+ an extensive network and a high
degree of localization of the
components manufacturers in the
western region of the country
+ Integration into global production
chains of foreign car holdings
- loss of metallurgical industry by
East of the country
- low level of financial and credit
system development (high interest
rate loan)
Supporting and
interim industries
Demand conditions
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