The recent restructuring of automotive supply-chains in response to intense competitive pressures has led to rapid change in, and upgrading of, the skills required by automotive component suppliers. In this paper we compare matched samples of Tier 1 and Tier 2 suppliers in Germany and Britain in order to examine how the ability of suppliers to develop the required new skills has been affected by the comparative strengths and weaknesses of the two countries vocational education and training (VET) systems. Our findings suggest that higher levels of craft apprentice training in German establishments give them an advantage over their British counterparts in responding flexibly to changes in markets, technologies and supply-chains. Furthermore, the engineering and commercial graduates produced by German Fachhochschulen help German suppliers to improve design skills relatively quickly and to manage long-term relationships with local supply-chain partners. Copyright © 2005 Inderscience Enterprises Ltd.
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