Efficiency of the Automotive Industry in the Visegrad Group

Abstract

This article assesses the production efficiency of automotive sector companies in the V4 countries. The automotive sector has undergone dramatic changes in recent years, and its future development is still unclear. The assessment of company efficiency thus represents an important tool that could support decision-making on the future of this sector. Unfortunately, comprehensive studies based on micro-data on companies are not yet available. This article evaluates production (technical) efficiency based on accounting data of individual companies in the V4 countries using the parametric method of stochastic frontier analysis. In these analyses, efficiency is examined not only from the point of view of a country but also with respect to the size of a company. The empirical results show that not only country but also the size of a company are factors that have a statistically significant effect on company efficiency. Small companies struggle to keep up with their competitor and in general have the lowest efficiency ratings.

Assessing the Technical Efficiency of European Companies in the Automotive Sector

“…This question can be approached from two perspectives. The first is to look at the European automotive industry (as in [1]) as a whole, the second view is to monitor its state and development at the level of individual countries (as in [2]). In this article, the authors will mainly draw on the findings presented by [2], where the authors focus on the evaluation of the automotive sector in the V4 countries.…”

“…The first is to look at the European automotive industry (as in [1]) as a whole, the second view is to monitor its state and development at the level of individual countries (as in [2]). In this article, the authors will mainly draw on the findings presented by [2], where the authors focus on the evaluation of the automotive sector in the V4 countries. The results showed that economically, these countries are already so interconnected that the main differences in efficiency are determined by the size of the enterprise.…”

“…An interesting finding was the positive relationship between company efficiency and the inclusion of environmental measures. However, recent findings in studies by [7] and [2] show that this detailed view is essential for assessing efficiency. The study by [7] confirms that the location of the company within the supplycustomer chain and its size is an important factor.…”

“…The study by [7] confirms that the location of the company within the supplycustomer chain and its size is an important factor. The study by [2] highlights the importance of company size (and thus the impact of economies of scale or specialization). However, these findings have only been validated for a limited geographical area (study [7] for Malaysia, study [2] for V4 countries).…”

“…The study by [2] highlights the importance of company size (and thus the impact of economies of scale or specialization). However, these findings have only been validated for a limited geographical area (study [7] for Malaysia, study [2] for V4 countries).…”