The US–Mexico–Canada Agreement (USMCA) introduced a new compliance institution for labor rights in trade agreements: the facility-specific Rapid Response Labor Mechanism (RRM). The RRM was developed to tackle one particular thorn in the side of North American integration – labor rights for Mexican workers – as it had had detrimental, long-term political–economic consequences for the US–Mexico trade relationship. This article reviews the unique political–economic moment in the United States and Mexico that prompted the creation of this tool. It describes how the RRM works and the considerable financial and human resources the US and Mexican governments deployed to operationalize it. The article then reports a number of stylized facts on how governments used the RRM during its first three years, largely in the auto sector. It proposes paths of potentially fruitful political–economic research to aid understanding of the full implications of the RRM and concludes with preliminary lessons as well as a discussion on the potential for policymakers to assess facility-specific mechanisms for labor or other issues, such as the environment, in future economic agreements.

In the late twentieth century, the European Union (EU) emerged as a global leader in setting environmental protections, including vehicle emissions standards. But member state consensus around environmental rules did not come easily, and the regional norms eventually set by the EU and its predecessor, the European Economic Community, had complex origins. This article argues that common emissions standards were ultimately achieved through a public-private process during the program to create the Single European Market in the 1980s and 1990s. For regional policymakers, standards were key to achieving an internal car market and strengthening the auto industry's global competitiveness; for many European carmakers and their transnational business associations, common norms could facilitate economies of scale and level the playing field. The “liberal environmentalism” born out of this convergence of interests produced common standards that fell pragmatically between the greenest member states and those most invested in protecting their national champion firms.

Australia developed a strong and successful automotive manufacturing industry after the Second World War, based on active industrial policy. But in 2017, mass vehicle assembly in the country will cease altogether, as the last global automakers operating in the country close their final plants, with negative spillover effects along the automotive manufacturing supply chain. After 2017, Australia will be the only major industrial country with no vehicle assembly whatsoever. This article analyses the shifts in industrial policy that explain both the initial postwar expansion, and the subsequent decline and closures. Policy-makers incorrectly assumed that the critical goal of stimulating automotive exports could be achieved through trade liberalisation, but dismantling tariffs only stimulated vehicle imports without increasing overseas demand for Australian cars. Production declined in tandem with tariffs, and there was no clear industry policy strategy for facilitating the redirection of released resources to more productive manufacturing activity, when that outcome, predicted in neoliberal comparative advantage theory, failed to materialise. Financial market deregulation, resulting in financialisation of the economy, coupled with high commodity prices, resulted in an overvalued and volatile currency, attracting foreign investors to resources and asset speculation while appearing to increase manufacturing production costs. A clear contrast is drawn between Australia’s policy passivity in recent decades, and the continued policy activism visible in other jurisdictions of all political orientations – including countries which, particularly after the global financial crisis, faced economic and industrial challenges at least as daunting as Australia’s. In the 1970s, Australia had been among the world’s top 10 auto manufacturers; after 2017, it will be one of only two G20 countries completely lacking mass automotive manufacturing capacity. The industry’s disappearance from Australia is shown to have resulted from some unique policy choices: understanding them may help avert future similar policy errors.

This paper focuses on agency workers in China's auto industry. Some scholars foresee that this new category of workers, particularly in the auto industry, will play a leading role in global labour resistance. In this context, we conducted a questionnaire survey of 483 regular and agency workers at five major auto joint ventures in China and compared their work conditions, job satisfaction and willingness to take collective actions. Based on these findings, we argue that these companies have good reasons to keep the gap in wages and in work conditions small. This, along with management practices inherited from the Maoist system, can mitigate workers' dissatisfaction and reduce their tendency to take militant actions.

The auto industry is usually considered to be a global industry. Yet the majority of passenger cars are still manufactured and sold in industrialised states where its largest firms are headquartered. The central claim made is that despite the auto industry being comprised of multinational corporations, there are clear national differences in the motivations firms cite for environmental initiatives. US firms are more focused on traditional material factors, especially market forces. However, German and Japanese firms are more focused on social concerns and internally-driven strategies. They have more normative, non-market rationales for their environmental initiatives. By analysing what firms themselves say motivates them to improve the environmental performance of their products, via a qualitative analysis of recent environmental reports by German, US and Japanese firms, as well as interviews conducted with key personnel, the conclusion reached is as follows. While the question of ‘greenwashing’ versus real commitment to reduce the environmental impact of the industry's products remains relevant, the institutional basis of capitalist relations in their home state (i.e. their home state's variety of capitalism) suggests different nationally appropriate and conducive paths to environmental commitments.

Negotiations for China's accession to the WTO provoked a debate between pessimists who believed that opening the economy would lead to a flood of imports and a de-nationalization of manufacturing industry, and those who believed that it would spur rationalization of state-owned enterprises, lock in domestic reforms, attract foreign investment, and open the way for trade expansion. The industry most frequently mentioned as endangered was motor vehicles, where an awkward combination of Stalinist central planning with localized autarky had resulted in a proliferation of inefficient producers. With the partial exception of two investments by Volkswagen, initial joint ventures in assembly operations failed miserably. China's commitments on joining the WTO banned (or at least complicated) many of the most important industrial policy tools it had used to promote the auto industry since the opening to joint ventures in the early 1980s'including performance requirements, high tariffs, and numerical quotas. After accession in 2001, tariffs fell steadily while output and foreign investment soared. The Chinese government moved towards a lighter-handed but more effective form of industrial policy that reduced top-down planning while expanding market incentives and scope for managerial freedom. Rather than destroying industrial policy for the auto industry, WTO accession constrained and disciplined it. When foreign auto firms and their governments pushed for more aggressive protection of trademarks and other intellectual property rights under the WTO, the Chinese government initially stalled. Continuing pressure then tilted the balance of state policy toward promotion of independent design, whether by state-owned enterprises testing the boundaries of their joint ventures with foreign multinationals, or by audacious smaller firms purchasing foreign designs and technology to complement inexpensive local parts and assembly, thereby creating the conditions for the emergence of a more competitive industry.

This paper explains the extraordinary rise of the Beijing Hyundai Motor Company (BHMC), a joint venture between a state-owned enterprise run by the Beijing municipal government and Hyundai Motor Company. Within the span of three years, the BHMC soared to become China's second-ranked automotive manufacturer in terms of units sold. I highlight the role of the Beijing municipal government in creating favourable market conditions for the BHMC during its initial operation phase (2002–2005). The Beijing municipal government selectively adopted protectionist measures and liberalizing measures to promote its locally based company. I characterize this practice as fragmented liberalization, a system through which sub-national governments discriminately apply WTO or central government regulations to promote their local joint venture partner. In so doing, I also challenge the existing assumption that multinational companies are the drivers of economic liberalization, by showing Hyundai's support for local protectionism and industrial policy at the sub-national level.