General Motors Essay

606 Words 3 Pages
US automobile industry began at the end of the 1800’s and by the 1890’s one out of seven jobs and one out of six businesses owed their existence to the automobile. Also this industry was the largest single customer for many raw materials but now With analysts debating whether or not the American economy is already in a recession, the big three automakers in the US especially General Motors are sharply scaling back production. The facts described by Danny Hakim in an article (G.M. Sees a Loss Near $1 Billion; Stock Falls 14%) published in NYtimes on March 17, 2005 say that announcement by GM about losses of almost a billion dollars for last six month dropped its share to the lowest level in more than a decade. Also it is considered to …show more content…
US companies especially the auto industry are no longer enjoying monopolistic powers in business world. Local auto industry is facing a big threat from foreign companies like Toyota, Nissan and Honda. General Motors, which controlled nearly half the American market as recently as late 1970s, is now finding it difficult to manage in new competitive environment and its market share has fallen to one quarter in February. Company is broadly struggling and Toyota is more likely to displace GM in next few years to be number one in auto industry. No doubt GM is innovative in models and designs but brands like Pontiac, Buick and Saturn are not appealing customers any more, described by J. D. Power & Associates, the quality and customer satisfaction analyst. Ronald Tadross, an analyst at Bank of America said "we continue to believe G.M.'s products are overpriced". This strongly brings in an idea of cost competitiveness. GM has to be cost competitive in order. to regain market. Questions are also being raised on GM’s strategic management. Mr. Rick Wagnor, GM’s chief executive, is facing music due to his corporate strategy and few industry analysts call him a visionary leader, but on the other hand many think that he is a skilled executive who has held the company together in crucial situations. Others say G.M. needs a more radical corporate strategy to ensure its survival To conclude my

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