This study contributes to the literature on latecomer strategy by examining how a latecomer automaker can shift from an imitator to an innovative follower under rapid technological and market change, focusing on Toyota’s strategy in the Chinese electric vehicle (EV) market. Building on the frameworks of ordinary capabilities (OC), dynamic managerial capabilities (DMC), and Kawai’s entry strategy typology, this study develops a process-based view of OC by distinguishing between its contents (work systems) and processes (sensing, transforming, and executing). Through a case study of the bZ3X project, supported by interview data, the analysis shows that Toyota initially relied on its existing OC to sustain performance and “buy time,” despite delayed strategic adaptation. However, these capabilities proved insufficient in the fast-evolving Chinese EV market. The turning point came with the bZ3X, where both the contents and processes of ordinary capabilities were reconfigured through collaboration with GAC (Guangzhou Automobile Group Co., Ltd.), a major Chinese state-owned automotive manufacturer headquartered in Guangzhou. This transformation was not a simple transfer of capabilities but rather an interdependent restructuring mediated by a key individual. The study highlights that latecomers must reconfigure both capability structures and processes to achieve competitive repositioning.
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