In March, 1992 a white Opel Astra rolled off of the assembly line at the new plant of GM Hungary in Szentgotthard (sent-goat-hard), near the Austrian border.' The significance of the event was signaled by the presence of Prime Minister Jozsef Antall. What made this such an important accomplishment? The many answers to that question outline fundamental developments in the auto industry and in the economies of eastern Europe. Among them: Hungary has never developed a native automobile business; 2 investment by the worlds largest auto producer represents a great achievement by Hungarian government and business leaders; the plant itself embodies significant changes in GM's approach to making cars, including teamwork concepts not easily implemented in a seedbed of nearly a half-century of communism; completion of the plant and initiation of production takes place against one of the most complex socio-economic backdrops of the century.
This research project focuses on the entry of western European auto makers into eastern European markets and economies. Its purpose is to examine evolving competitive circumstances in the manufacture and marketing of automobiles and to explore the emerging role of eastern European economies in that industry. The study necessarily considers a number of forces at work influencing the industry: -1 investments by auto firms in eastern Europe; -2 market considerations; -3 competitive issues; -4 The European community and the auto industry; -5 privatization; -6 immigration; and, -7 environmental issues. The endpoint of the analysis is to determine the nature of changing competition in the auto business in Europe and the future complexion of the industry with eastern European participation.