Chinese enterprises in Germany: Establishment modes and strategies to mitigate the liability of foreignness

Although China shows an impressive increase of outward foreign direct investment, research on internationalization strategies of Chinese companies is still in its infancies. It remains unclear, for example, how Chinese MNEs cope with the specific institutional hurdles of a developed country such as Germany and to reduce their liability of foreignness (LOF). Given a remarkable lack of in-depth empirical studies, we present insights from 31 semi-structured face-to-face interviews with employees belonging to seven Chinese MNEs and stakeholders. Our findings suggest that Chinese MNEs have gained international experience, whereas strategies to reduce their LOF depend on the establishment mode chosen. (C) 2010 Elsevier Inc. All rights reserved.