General bankruptcy which the US government had to

General Motors Company, generally called GM, is an American
multinational organisation located in Detroit that is engaged in designs, developments,
production and marketing of cars and vehicle parts and also offers financial related
services. (Gm.com, 2018)

 

The automobile business were encountering a blend of
pricing weights from raw material expense and changes in the buying
propensities of the consumers due to quick increase in the cost of oil. G.M and
other automobile businesses were likewise going through external competition from
the public transport segment, as consumers re-asses their private vehicle
usage. U.S is the world’s largest consumer market for light vehicles, passenger
cars and light trucks which are conquered by big three companies i.e. General
Motors, Daimler/Chrysler and Ford Motors. But recently these three organisations
begun to lose their market share to other rivals within the industry. General
Motors are facing huge competition by domestic company such as Ford Motors and
Daimler/Chrysler and also by foreign industries such as Toyota Motors and Honda
Motors who are able to produce cars at a much cheaper cost than General Motors.

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In 2009, General Motors encountered bankruptcy which the US
government had to step in and help with the survival of the company. They are
shutting down manufacturing in Australia. And the reasons for its bankruptcy
are because they were focusing mostly on their finance division rather than its
vehicle design operation. GM cars were poorly designed and built, it took years
to manufacture as compared to its major competitor Toyota who has better
designed, high quality and cheaper automobiles. In the past GM controlled half
of the North America vehicle market but presently it has only 19 percent
control as GM has not been taking notice of the competition due to which Toyota
and other industries took advantage of to take over the market share.

Since General Motors were paying attention only on profit
making they did not care about designing and building better vehicles. It was
managing in a bubble as GM rewarded those employees who followed the old way of
doing things and those who praises CEO ideas and follow up his requests. (Keith Crain, 2017)

 

 

 

 

 

SWOT
analysis of General Motors

General Motors (GM) is involved in the design, growth, manufacturing
and distribution of cars, trucks and automobile parts. The firm obtains an important
competitive advantage by having a solid position in the world’s biggest auto
market located in the US and China. Its huge existence in these two markets assists
in conveying maintainable business growth which helps GM to further strengthen
its global market leadership. However, high competition in the market could
result in lower sales volume as well as margins for GM and may result in decreasing
market share. (Web.a.ebscohost.com.ezproxy.ntu.ac.uk, 2018)

Strength
 
1.Durable technological
advancement increases new product improvement
 
2.Solid positions in
North America and China provides maintainable business development

Weakness
 
1.Recurrent product recalls
affects brand image
 
2.Insufficient
funding of pension obligations affects financial position

Opportunity
 
1.Good presence of a
worldwide automobile manufacturing company can increase sales and market share
 
2.Benefit from the increasing
demand for electric and other fuel powered cars
 
3.Entry back into the
improving US market

Threats
 
1.Strict government
rules can affect work performance
 
2.Sales and Revenues shifts
of currency exchange rate could have an effect on work performance and
financial well being
 
3.High competition could
negatively affect the market share, sales volume and margins

 

 

 

Strength

Durable
technological advancement increases new product improvement

General Motors has a solid product planning and advancement
capacities. The organisation spent roughly $8.1 billion and $7.5 billion on the
research and development activities in 2015 and 2016. It is centred around
improving new goods and services, developing existing goods and services,
including activities similar to vehicle emissions control, enhanced efficiency and
the wellbeing of drivers and travellers. The organisations number one priority
is to proceed to create and propel its elective impetus procedure, fuel productivity
and oil utilisation through the improvement of a wide assortment of new
technology. Therefore, GM keeps on creating Flex Fuel vehicles that keep
running on gas-ethanol mix fuels as well as vehicles that run on CNG and melted
oil gas. As of now, the organisation offers 11 Flex Fuel vehicles in the US for
the 2017 model year and an extra seven models to armada and business customers equipped
for working on gas, E85 ethanol or any blend of the two.