This research contributes to the study of subnational phenomena and SOEs internationalization by comparing the expansion abroad of Subnational SOEs (SSOEs) and Central SOEs (CSOEs). Through a qualitative comparative case analysis, we find that SSOEs’ fewer resources and needs to increase income push them to follow a gradual market-driven internationalization. These incentives also push SSOEs to diversify abroad. CSOEs non-gradual growth is justified by non- market factors (i.e. politics). We posit that SOEs’ high managerial autonomy becomes crucial to achieve a sustainable international trajectory. Irrespective of the ownership type, low managerial autonomy encourages international reversals due to political and financial pressures.