This paper discusses the reconfiguration of Brazil's tire production chain resulting from the pioneer outsourcing and vertical disintegration of the tire cord treatment units, also known as dipping units. A case study of the contractual relationship between two large multinational corporations is used as a methodological strategy. Analyses are made of the process of contractual adaptation and of the factors that may have contributed to delay the decision to restructure the tire production chain in Brazil. The Transaction Cost Economics approach was chosen as the theoretical framework, mainly due to its analytical capacity regarding the limits of action of firms or organizational networks. The empirical findings indicate the importance of specialized local suppliers as a critical factor in the restructuring of the supply chain through outsourcing strategies. The institutional environment, both formal and informal, is as relevant to the contractual process as it is to the decision-making involved in the definition of new organizational boundaries.
supply chain management; outsourcing; transaction costs; asset specificity; institutional environment
