Firms are actors in globally dispersed value chains. In the past three decades, GVCs (global value chains) have come at the forefront of social sciences research as an important channel for spillovers and linkage creation to foster technological change and development (Saliola & Zanfei, 2009). Firms active in GVCs have been found to be more likely to adopt new technologies, be it in the form of new equipment, production standards, or management practices (De Marchi et al., 2018), yet the nature of interfirm relationships along GVCs remains unclear. Automotive has been one of the pioneering sectors in the process of outsourcing and GVCs emergence; after the 1980s, the innovation around ICTs technologies paved the way for long-distance business. The emergence of dispersed value chains, which in the case of automotive became more regional than global, created opportunities for countries that targeted the linking up to automotive GVCs as a channel to foster development. Such linking up and technological upgrading has been highly dependent on local suppliers’ capacity to absorb, master and adapt knowledge and capabilities that leading firms can transfer to them (Morrison et al., 2008). Absorptive capacity in an industry characterised by high economies of scale and high productivity standards involves skills specific to the technology, and they imply an adoption cost represented by the cost of training and the effort of building up the firm-level capabilities in the host country. This chapter aims to assess how GVCs can provide opportunities for technological upgrading by analysing technological change through a firm-centric approach, which allows more space for business and technical considerations. By unpacking and analysing the insights coming from the nexus between micro-level processes and GVC dynamics, the chapter allows to characterise in more analytical terms the potential and the constraints for technological change within GVCs.