...General Motors’ Crisis Communication Plan Public Relations & Corporate Communications Company Overview General Motors (GM) is an American global car manufacturer headquartered in Detroit Michigan. Employing 202,000 people, GM produces automobiles in 31 out of the 157 countries in which it conducts business. In 2011, GM succeeded in surpassing Toyota and Volkswagen with the largest number of sales worldwide, 9.03 million vehicles1. At the heart of General Motor’s charge is customer satisfaction: “At the new General Motors, we are passionate about designing, building and selling the world’s best vehicles. This vision unites us as a team each and every day and is the hallmark of our customer-driven culture.”2 Background Information As the world emerged into the 20th century, automobiles were viewed as new, cutting edge technology. Little did the world know how dependent economies would become on this “carriage with no horses.” In order to meet the growing public demand for automobiles, new companies emerged on a widespread scale. Among the first on the scene was General Motors founder, William “Billy” Durant who founded the company on September 16, 19083. Throughout the first few decades after the company’s creation, General Motors only held possession of Buick Motor Company, but as the years progressed General Motors acquired an additional twenty car manufacturers including Oldsmobile, Cadillac and Oakland, also known as Pontiac. After the world recovered 1 http://www...
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...brand established in 1926 as a companion make for General Motors’’. General Motors made the first Pontiac car in 1926 with a V6 engine. (Ron,1999). Pontiac started to make models from 1926 till 2010, and then it got bankrupt for many reasons, but the main ones are : product overlap, and profit margins. First of all, Pontiac had too much overlap with Chevrolet. Pontiac cars were great Cars, but there were few of them that supported General Motors to get Pontiac out of business. There was no need for a G6 GTP when you have the Malibu LTZ. For example, people in the hole world are not supposed to buy a 2006-2009 Pontiac G6 GTP which is available in limited countries when the Malibu LTZ is available in worldwide.(Asker,2010). In addition, Pontiac were the prettiest cars made by General Motors. However, few of them were bringing excitement. (Ron,1999). Not all Pontiac cars were sold to bring excitement. For instance, a Pontiac Grand Am will stand out in a crowded parking lot, but a Bonneville will not stand out in a parking lot. Second, Pontiac got bankrupt because of low profit margins. According to Asker (2010), “ Pontiac is not a premium brand”. Some of people have said that General Motors should keep Pontiac instead of Buick. But, the sales ...
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...General Motors Co Strategic and Financial Analysis ADVANCED CORPORATE FINANCE April 22, 2012 Authored by: Ana Romero, Roshan Picardo, Carlos Castro, Shikhar Agarwal 0 General Motors Co Strategic and Financial Analysis Executive Summary This report provides an evaluation of strategic and financial evolution of General Motors Company (GM) in the last ten years. Events like the global economic recession lead to a deep restructuring of the firm, filling for bankruptcy and a government bailout. The report provides an analysis of GM’s business model, products, the markets it is competing in, the global automotive and manufacturing industry and it also assess its attractiveness for incumbents and new entrants is also With a brief history of GM we evaluate its reaction to the global recession. We compare their business model before, during and after the recession, comprising the strategic and financial implications of their restructuring plan. We provide results from this restructuring, including improvements in GM’s financial ratios like ROA (from 0.05 in 2010 to 0.07 in 2011) and ROE (from 0.23 in 2010 to 0.25 in 2011). While the recession significantly affected GM, it also affected the rest of the automobile industry, including their American competitor Ford Motors. We compare the main differences between these two important companies and analyze the way they reacted to the recession. We also observe the approach that Ford has taken to recovery, in terms of governance...
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...Moise Jinior Professor Hamilton SWOT Analysis 8/22/12 General Motors SWOT Analysis Strengths If we look to the strategy analyses General Motors (GM), first of all GM needs to focus on their strengths. The advantage that General Motors had it’s the brand value that they made over these pass decade. Everything started in Michigan; General Motors was created around 1900’s. They always has been made some amazing high quality cars for their customers, and from this remarkable work they were know as one on the best automobile brand worldwide. The products that General Motors provide are safe and they guaranty a long lasting service to their client. In addition GM wanted to be unique compare to the competitor such as Ford whom as been on the automobile market at the same period. GM developed a large different brand such as Cadillac, GMC, Buick and Chevrolet. With These different products line General Motor was able attract a large number of costumers. Another strength, General Motors from been just an US company afterward they became an international company. Even though they had been successful in the worldwide market but not as great as the US markets. General Motor sell they car oversee in 60 countries over the globe. To make this possible GM needs partner such as dealerships over the world to provide they new product and they service to the costumer. GM has one of the most important and biggest...
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...Course Project Proposal The ideal of this project proposal is to compare and contrast General Motors and Ford which have undergone fairly substantial change in the recent past; and how they handled the pressure of change. Lapratt04@yahoo.com HRM-587-12043 Managing Organizational Change Professor Joseph Phillips Due September 7, 2014 Abstract Ford and GM experienced serious issues during the pre and post TARP causing them to restructure and change how they do business. Each of them reacted to these pressure differently. Ford Motor Company as one of the greatest automobile manufacturers of all time started under the leadership of Henry Ford in Detroit, Michigan. His first production was in 1903, the Model A, with an under the floor engine selling for $850. In the first season it sold 1,708 cars (HISTORY of Ford Motor Company, 2014). Whereas General Motors was founded in 1902 by William Durant, who saw that the automobile would one day replace the horse-drawn carriage. The company did not really catch on until 1908, and at first, it was just a Buick holding company. At the end of 1908, however, GM had acquired Oldsmobile, and in 1909, they bought Cadillac, Elmore, and Oakland. The early 1900s were a difficult time for auto manufacturers; the market crash of 1907 adversely affected a lot of small companies, which relied on the banks for credit. Durant saw the economic downturn as an opportunity; he bought smaller car makers, as well as companies that built auto accessories...
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...Business-Level and Corporate Level Strategies General Motors (GM) is a public company based in the United States that is headquartered in Detroit, Michigan. In the year 2011, the company was able to acquire the title of the largest automaker in the world by achieving the highest number of vehicle unit sales since inception (General Motors, 2012). General Motors led global automobile unit sales for 77 consecutive years from 1931 through 2007; however, the company lost its position to Toyota, which has continued to dominate the market with GM standing at second. The core competencies of a corporate corporation are focused on ensuring that the business entity is able to satisfy the needs and preferences of their customers. This stands as the main determinant in realizing above average returns especially in a highly competitive business environment. This is achieved through business level strategies, which are strategies that outline the various actions to be taken in order to ensure that the company is able to provide value to its customers in addition to gaining the critical competitive advantage by utilizing its core competencies in specific, service markets or individual products. Business level strategy therefore pertains to the corporation’s firm position in its operating industry compared to its main competitors and the five forces of competition. One of the fundamental business level strategies that General Motors has employed is cost leadership. The company has been...
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...MGX 9660 - International Business Theory and Practice Case n°10: The Collapse of General Motors PHAM Trang (23283300) REBOURG Malcolm (23625678) YAO Aileen (20460996) 1 Table of Contents I - Introduction………..………...………………………………………….….….p 3 II - What are the internal and external factors that contributed to GM’s decline and eventual bankruptcy protection application?……………….....….p 4 Internal Factors...………….……..…………………………...……….……….…p 4 Extenal Factors……….…..…………………………..……….………………….p 5 III - Discuss the latest stage of the new (smaller) GM……………….………...p 6 What are the characterisics of the new GM?..………………………………...…p 6 Some encouraging signs of recovery………………………………………....….p 9 Threats regarding GM’s trials to regain its golden past………………………….p 11 Summary and Observations……………………………………………………...p 13 IV - With a majority government ownership, what operational and management challenges might GM’s management confront when trying to regain its golden past?…….………………………………….………..p 14 Operational Challenges..………………………………………………………….p 14 Management Challenges………………………………………………………….p 15 Summary and Observations………………………………………………………p 16 V - Critically Analyse Whether it was GM’s Failure or its Competitors’ enormous success in cost savings and innovation that brought about GM’s demise…………………………..…...….……………………..…….….….p 17 Cost Savings - a poorly designed cost structure……...………………………….p 17 Innovation Processes…………….…………..…………………………………..p 18...
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...began to trend downward, it became apparent that two of the three primary automakers were in significant financial peril. With government aid already being allocated to some of the nation’s largest financial institutions, difficult decisions had to made as to how to approach the alarming crisis at the heart of an industry woven throughout the lives of so many United States citizens. Introduction Beginning in the early twentieth century, automobile makers began marketing and ultimately selling cars to middle-class Americans. It did not take long for a deep love affair for cars to develop across the nation, and ownership became woven into the fabric of the “American Dream”. The invention of the assembly line in the 1910s made automobiles relatively inexpensive, and by 1929 it is estimated that American car companies were producing 5.3 million cars per year (Miller-Wilson, n.d.). The automotive industry surely had its share of ups and downs during the 1900’s, with two World Wars, the Great Depression, an oil crisis in the 1970’s, amongst many other challenges. Despite such trying events, it wasn’t until late in the twentieth century that signs of trouble began to show within the “Big Three” United States based automakers: General Motors, Chrysler, and Ford Motors. Soon after the turn of the 21st century, it became apparent that two of the automakers, General Motors and Chrysler, were in extreme economic peril. Despite...
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...Ford Motor Company not only survived the financial crisis of 2008/2009, which had pushed General Motors and Chrysler into bankruptcy, but also emerged as a robustly competitive member of the world’s leading auto producers. However, Ford’s ability to sustain its strong financial performance depends critically on the state of the world’s automobile industry (Grant). Synopsis of the Case: The automobile industry soared in early 1920’s and became primary industry which drove US economy during that time and Ford had built the largest factory in the world which corroborates the growth and state of auto industry and since then it is having huge impact on US economy. Relevant Factual Information about the Problem The downfall of auto industry in 2008/2009 suffered losses to such an extent that General Motors and Chrysler, two of the Big Three players, filed for bankruptcies. Financial crisis was not the only reason, high supply and less demand was one of the prominent reason for the financial crisis. This decline in industry revenues and profits in 2008 promised a major industry restructuring. (Grant) Explanation of Relevant Concepts. A SWOT analysis on the Ford gives more insight and effective solution to sustain the financial performance and have an edge over competition. Strengths: Ford has strong position in US market and it is the second largest auto-maker in US. It was described as the “most important industrial company in the history of the United States” by Forbes...
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...Hamilton 24 October 2012 GM SWOT Analysis As one of the world’s largest automobile manufacturers, General Motors (GM) was found in 1910. Today, GM has become an essential organization in the US that has a significant impact on the overall economy. GM markets its products under these well-known automobile brands: Buick, Chevrolet, GMC, FAW, Daewoo, Cadillac, Holden, Jiefang, Vauxhall, Opel, and Wuling. Followed by the US, Brazil, UK, Canada, Italy, and Germany, now China has become the largest market for automobile industry. SWOT analysis stands for the analysis on strengths, weaknesses, opportunities, and threats. Strengths: The first strength GM has is its brand value and image. Since 1910, General Motors has established a stable market share along with Chevrolet, Cadillac, and Buick and become a household name. Moreover, GM brand is rooted not only in the US but also throughout the whole world. Second, General Motors has a large global presence as well. GM truly has a big worldwide presence that it has manufacturing, assembly, and warehouse operation in 55 countries. Third, high quality products and services have always been the center for the company for achieving success. Finally, GM has a significantly high market share that it runs the business in 157 countries. Weaknesses: First, GM has complied more than 1000 dealerships for closure. At the end of 2008, General Motors had 715 dealerships in Canada, but a year later, GM has called for nearly 200 closures. The organization...
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...R e se a rc h a n d Stat i s t i c s B r a n c h working paper 16/2009 Impact of the Global Economic and Financial Crisis over the Automotive Industry in Developing Countries UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION RESEARCH AND STATISTICS BRANCH WORKING PAPER 16/2009 Impact of the Global Economic and Financial Crisis over the Automotive Industry in Developing Countries Peter Wad Copenhagen Business School UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Vienna, 2010 This paper was prepared by Peter Wad, UNIDO consultant and backstopped by Nobuya Haraguchi, UNIDO staff member, Research and Statistics Branch, Programme Coordination and Field Operations Division. Iguaraya Saavedra provided administrative support. The designations employed, descriptions and classifications of countries, and the presentation of the material in this report do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations Industrial Development Organization (UNIDO) concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries, or its economic system or degree of development. The views expressed in this paper do not necessarily reflect the views of the Secretariat of the UNIDO. The responsibility for opinions expressed rests solely with the authors, and publication does not constitute an endorsement by UNIDO. Although great care has...
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...Toyota Motor Corporation: A brief history The Toyota Motor Corporation was founded in 1937 by Kiichiro Toyoda. It originally started as a subsidiary of his father’s company Toyoda Industries. The first vehicle, the Toyota AA, was produced in 1936 even the company was still associated with Toyoda. The brand was established as an independent company in 1937 and changed their name to Toyota. The change of its name was implemented to signify a separation of work and home, to simplify the pronunciation and because it only took 8 brush strokes (which is considered lucky) to write in Japanese. Toyota opened their first factory in 1938 but it had to be cease production during World War II. In 1950 the Toyota Motor Sales Company was established and the company began production on the BJ Toyota Jeep, the BX truck and the SG small truck. In 1956 the Toyopet chain was established. The first vehicle to be sold under this name was the Toyopet SA. The product line was discontinued in the 1960s due to negative connotations with the words toy and pet. During the 1960s Toyota opened a new research and development facility as well as establishing a prominent presence in Thailand. During this time Toyota also celebrated the production of its 10 millionth model. In 1982 the Toyota Motor Sales and Toyota Motor Company formed a merger to become one company, the Toyota Motor Corporation. Following this the company entered into a joint venture with General Motors called the New United Motor Manufacturing...
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...Recent financial events have led to a shaky and uncertain economy. Numerous financial institutions had collapsed, housing markets plummeted, and many corporations filed for bankruptcy. The auto industry suffered many hardships, enough that the government stepped in to offer bailout financing in order to keep operations and employment continuing. While the Ford Motor Company choose to restructure its own operations without accepting government assistance, General Motors Company had accepted the government funded bailout. This bailout encompassed numerous stipulations including changes in financial structure of operation and management. The end goal to stabilize the company, return from bankruptcy and back to providing affordable and dependable vehicles to its consumers. Reviewing past reports from various financial institutions, union employees and GMC’s annual reports I will discuss the change strategies since filing of bankruptcy and the government bailout. The second corporation I would like to research, for personal as well as scholastic purposes, is KIA Motors. During the time just prior to GMC’s financial crisis, KIA also had a change of management. This was working towards expansion, increase in profits, sales and producing award winning vehicles for the market. With the restructure of GMC and the difficulty of market finance, KIA had the opportunity to take market shares in America and further boost its standing as a solid competitor in the automotive market...
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...Corporate Finance FIN-325 I. General Overview General Motors, also known as (GM), is an American multinational corporation headquartered in Detroit, Michigan. General Motors was founded on September 16th, 1908 in Flint Michigan by William C. Durant as a holding company, or a wholly owned subsidiary for Buick. The company designs, manufactures, and distributes vehicles on all six major continents under 18 brand names. Some of their well-known brand names include Chevrolet, Buick, Cadillac, GMC, Opel, Vauxhall, Wuling, Baojun, and JieFang. GM also operated the brand names of Saturn, Pontiac, and Hummer until 2009. During this time, GM was emerging from chapter 11 bankruptcy as a result of the 2008 financial crisis, and decided to shed those brands for strategic reasons in order to compete with foreign emerging vehicle distributers in the market. In January 1912, the company decided to incorporate themselves under the GM brand name, and were the gold standard in the automobile industry for almost 80 years. From 1931-2007, GM successfully led global sales amongst every car manufacturer in the auto-manufacturing industry. Currently, the automobile industry is one of the most fierce industries in the market. Not only is GM competing with American car manufacturers such as Ford and Dodge, but also foreign companies such as Toyota, Honda, and Hyundai. II. Financial Statements (attached excel sheet) Anthony Brooks For: Professor Goncalves Corporate Finance FIN-325 Final...
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...Automotive industry crisis of 2008–2010 Team members: Ahmed khaled said 20080044 (searching and collecting the cases and all the data that we need it from the internet) Maged mohsen el-wakeel 20080631 (summaries the case and the data that we got it) Moaz abdel raheem 20080626 (typing the project at word) Ahmed gamal 20080400 (he did the outline. also he organized the shape of the project and work in the presentation slides and the design of it.) Summary The automotive industry crisis of 2008–2010 was a part of a global financial downturn. The crisis affected European and Asian automobile manufacturers, but it was primarily felt in the American automobile manufacturing industry. The automotive industry designs, develops, manufactures, markets, and sells motor vehicles, and is one of the world's most important economic sectors by revenue. The term automotive industry usually does not include industries dedicated to automobiles after delivery to the customer, such as repair shops and motor fuel stations. The Automotive industry has had a large outcome in production over the past 20 years. The downturn also affected Canada by virtue of the Automotive Products Trade Agreement The Canada—United States Automotive Products Agreement, commonly known as the Auto Pact or APTA, was an important trade agreement...
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