The paper analyses the impact of the presence of automobile assembly plants on the development of local economy. The research is based on a case study of Fiat in Campania. The first part of the paper analyses the transformation of automobile production and discusses the implications for the territorial division of labour. The second part of the paper presents the results of a diachronic research which covered a panel of firms located in Campania, operating within the supply chain of Fiat’s plants. The study highlights the ambivalent effects: The automotive industry has contributed significantly to regional economic performance in terms of the value produced, exports and employment; but the presence of Fiat’s plants induced a limited growth of local industry.
Keywords: Automotive industry, supply chain, local development, global value chain, industrial policy, industrial employment