Between Business Interests and Ideological Marketing: The USSR and the Cold War in Fiat Corporate Strategy, 1957–1972

Abstract

This article analyzes the landmark deal between the Italian automobile corporation Fiat and the Soviet government to build and operate the Volga Automobile Factory (VAZ). Drawing on formerly closed corporate records and declassified Soviet documents, the article traces how the Cold War helped shape the strategy of a West European multinational corporation in its attempts to manipulate the national and international political context in which it was acting. In Fiat's strategy toward the uncertain Soviet market, car production represented more of a bridgehead than an ultimate objective. Fiat's Ostpolitik was carefully planned and coordinated with the U.S. government and with other large Italian businesses. Italian-Soviet cooperation in building VAZ, the symbol of material well-being and peaceful industrial reconstruction, facilitated the requests of Soviet officials and Western corporations to lift East-West trade restrictions on non-strategic goods, thus conferring political legitimacy on trade with the Soviet Union.

Looking in the rear‐view mirror—A 35 year retrospective on the Russian automotive industry

“…The facility was opened in 1970 with an initial capacity of 660,000 cars per year which was eventually to grow to 730,000. Some 70% of the production equipment installed in the manufacturing site was of foreign origin (see Fava, 2018). In 1976, with the support of Ford, the largest truck manufacturing facility in Europe (KAMAZ) was opened, again in Volga region, with a capacity to manufacture some 150,000 trucks and 250,000 diesel engines per year.…”

“…There are several articles which are devoted to examining the development of manufacturing subsidiaries of foreign corporations in Russia (Holtbrugge & Puck, 2009;Golikova et al, 2011;Karhunen et al, 2014;Gurkov, 2014;Gurkov, 2016a;Gurkov, 2016b;Gurkov & Saidov, 2017;Gurkov et al, 2018;Gurkov et al, 2020a), but none specifically on the evolution of Russia's automotive industry. A handful of articles have explored East-West cooperation in the automotive industry (Fava & Luminita, 2017;Fava, 2018) or documented recent trends (Baronina, 2016;Baronina, 2020).…”

Looking In The Rear-View Mirror: A Thirty-Five Year Retrospective On The Russian Automotive Industry

“…There are several articles which are devoted to examining the development of manufacturing subsidiaries of foreign corporations in Russia [Holtbrűgge and Puck, 2009;Golikova, Karhunen and Kosonen, 2011;Karhunen, Kosonen and Ledyaeva, 2014;Gurkov, 2014;Gurkov, 2016a;Gurkov, 2016b;Gurkov and Saidov, 2017;Gurkov, Kokorina and Saidov 2018;Gurkov, Kokorina and Saidov, 2020a], but none specifically on the evolution of Russia's automotive industry. A handful of articles have explored East-West cooperation in the automotive industry [Fava and Luminita, 2017;Fava, 2018] or documented recent trends [Baronina, 2016;Baronina, 2020].…”

East–West cooperation in the automotive industry: Enterprises, mobility, production

“…In their internal narratives, they were making sense of their search for new markets and profits as an instrument for 'bridgebuilding' and peace, presenting automobile and individual motorisation as Trojan horses in the ideological and industrial fortress of communism. 13 When focusing on the decision-making process in the socialist economic bureaucracy, we are not surprised to find that in the majority of cases, political and state-building considerations won over reasons of economic profitability. As we learn from Miljkovic´, the central government of Yugoslavia determined both the structure and localisation of its automobile industry according to an 'ethnic key' and the need to promote the industrialisation of less developed areas of the country such as Kosovo or the Republic of Macedonia.…”