Cross-market Innovation: The Dynamics of Latecomer Catching-up Model from Emerging Chinese Electric Vehicle OEMs

Mainstream technology catching-up studies only focus on how latecomer assimilate the acquired technology from the developed countries in its home country, paying little attention to their technology innovation activities directly in the developed countries and interactions with home country to overcome first-mover advantages and catching-up with incumbents. This study examines the practices of the rapidly rising Chinese new entrants of electric vehicle (EV) OEMs, discovered the mechanism and path of Cross-Market Innovation (CMI), established its structural model based on multiple case analysis, proposed three-stage progressing path and three integration mechanisms, and provides new ideas for latecomer to leverage advantages from innovation systems of both developed and developing countries to achieve the change of technological leadership. These new EV players directly go to the USA to innovate on top of acquiring new technologies in the developed country, and leverage both first-mover and follower advantages, quickly becoming leading technologically in the areas of emerging technology innovation. The study suggests that latecomer could utilize CMI as their technology catching-up strategy and achieve technological leadership change in both home and developed countries. The CMI model has been tested through the structural equation model (SEM) through structured questionnaire.