Founded in 1908 by William Durant First auto company on NYSE took lead of industry from Ford
1970’s-80’s Japanese gain market share GM tried to match smaller car styles 2000’s- Recalls and Strikes
2008: 5,000 salary layoffs 2009: Government Bailout Ch. 11 Bankruptcy Motors Liquidation Company 2010: Rebirth, Restructure, Largest IPO
Present Day: Daniel Akerson trying to get GM back on top. Greener Cars Repay debt to the government
Federal Emissions Requirements Catalytic Converter Safety
Plastic/Carbon Fiber Body OnStar Hybrid Cars Hydrogen Powered cars
Barriers to Entry High Intensity of Rivalry Extremely High Bargaining Power of Suppliers Low Bargaining Power of Buyers Low Substitutes Low
High Liquidity Allows them to be more flexible in the future Strong Global Presence New found focus on individual brands Increased product quality
Customer Loyalty Stigma from the bailout “Holes in the line up” Declining US Market Share United Auto Workers
Emerging Markets South America China Alternative Fuel Technologies
Volatile Economy Raw Material Prices Oil Prices
Headquarters in Detroit, Michigan Became global in the 1920s Now manufacture vehicles in 31 countries
GM North America GM Europe GM South America GM International Operations
Retail sales fluctuate according to season Production varies each month Changeovers occur often throughout the year New market entries, vehicle models Business cycle depends on general economic conditions and consumer spending
The recession had a negative effect on GM’s United States Market It also affected factors that determine consumers’ buying decisions E.g. Price, quality, available options, style, safety, reliability, fuel economy, and functionality
G.M. Files for Bankruptcy Dramatic Turnaround Profitability Helped by Tax Breaks Carried Over Through Bankruptcy
G.M. Announces Still Losing Money in November 2009 2010 Turnaround -Rebuilding Operations -Increased Sales - full-year profit was equal to $2.89 a share
Competitive Cost Structure Cleaner Balance Sheet Stronger Liquidity
G.M. made $3.2 Billion in the 1 st Quarter -5 th Consecutive Profitable Quarter Sales
In 2005 the auto industry rides a new trend of “Employee Prices for Everyone”. 2005 is a tough year for both companies. “Way Forward” GM looks for government help GM emerges from bankrupcy Ford rebuilds workforce
Now -Akerson Keeping the Ship Upright 5 Years -New CEO -Hydrogen Cars -Emerging Markets 20+ Years -Hydrogen Gas Stations -Staying Within Their Limits