The Poletown Dilemma Contents Introduction 1 Who are the stakeholders involved in the new site selection decision? 1 What are the factors that you would consider to choose the new site? 2 What is your recommendation to General Motors regarding the site choice? Why? 4 How would you implement your recommendations? 4 Exhibit 1 Comparison of costs of setting up plants in Detroit and Mid-West 5 Exhibit 2 Linkages with the society across the value chain 5 Exhibit 3 – Categorization of Social Issues faced by GM 6 Introduction General Motors is faced with a dilemma. In the face of economic depression, competition from foreign players was driving down profits and the market’s preference was changing to efficient cars due to …show more content…
Schedule GM wanted the site to be available for construction by mid of 81, so that the plant is operational by September 1982 PoletownAlthough demolition was involved, quick take law will help avoid delaysQWL program built cooperation with union, and union was in support will help quicker time to hire/relocate workers. Detroit was where the GM headquarters were. Having new plant closer to headquarters would make management much simplerVendor ecosystem is already established | Mid-Western StateMuch faster with ease and support from state (given in case fact)New relations would have to be established with labor unionsManagement overheads are higher for new plant when away from headquarters | 3. Political environment and support for the business would be a third factor Poletown 1. Mayor Young has high ratings and is connected to the president 2. Head of PNC is administrative aid of state Senator 3. 6150 jobs created | Midwest1. Mayor Young will be against this option – and it could have an impact on other plants and HQ of GM?2. Other state supporting the new plant | 4. Social Impact Exhibit 2 describes GM’s linkages with the society across its value chain. There are inside out linkages such as generating employment, developing infrastructure and environmental hazards as well as outside-in linkages such as availability of labor, infrastructure and social and political goodwill The social issues faced by GM are 1. Loss of jobs
General Motors would create many jobs for Louisville, Kentucky and provide a boost to the city’s economy. After carefully reviewing all of the company’s projected financial information and demographics, Louisville is a clear choice. The city has a low cost of living and a perfect site for a manufacturing facility. Although the city has other automotive manufactures, there still appears to be a surplus of manufacturing jobs. With a local competitor announcing plans to lay off a portion of their labor force, General Motors would be able to benefit from hiring these skilled and experienced employees. After reviewing the survey we conducted, it was apparent people would consider working for General Motors. Due to the fact that this area is known
1. Do you feel that the Bearington plant has the right equipment and technology to do the job? Why?
1. Do you feel that the Bearington plant has the right equipment and technology to do the job? Why?
In the hyper competitive world of today’s mega corporations controlled by the sway of the stock market, giant old industrial era companies rule over the automobile market in the United States as well as large parts of the global automobile market. Companies such as General Motors, Chrysler, and Ford were at the center of it until the economic crisis now known as the Great Recession of the late 2000s. The whole market was declining in sales with General Motors and Chrysler taking the biggest hits while Ford only suffered decline comparable to foreign automakers’, Honda and Toyota, levels due to restructuring in prior years. However, the tipping point was edging closer to bankruptcy with General Motors and Chrysler that ultimately
A plant to construct a new Walmart branch is initiated, which there's a misconception that it will be in our interest, regarding its disadvantages.
Roughly 100 towns and cities applied for the $10 million downtown revitalization money and only ten got picked. Lieutenant Governor, Kathy Hochul says it was Elmira's plan of capitalizing on its strengths that put them on top. "The timing is right. There's new vitality with people coming downtown and living here and creating synergy with existing businesses and the cultural district. So they really have there act together. I want to give them a round of applause and pat on the back for putting together a successful, winning proposal," says Lieutenant Governor, Hochul.
It is definitely no secret that jobs have left the city of Detroit, which of course would be one of the more obvious reasons as to why the people left. Many people who left did have many valuable resources and connections that could have helped Detroit better it, instead of going down. Although that is the case, it does not mean that all of the people with resources have left. Some people have put forth their plans and are now working towards getting results. Some don’t have funds needed but they know exactly what needs to be done for the city. There are also some who have the funds and resources but don’t care enough to put forth effort. Compared to the 1950s and 1960s the workforce has taken a loss resulting in only one quarter of what it
Such an economic shift is identified as being a result of Awhite flight@, where the urban whites fled to the suburbs after WWII, with the immigrants, blacks, and rural dwellers moving in. The economy switched from an industrial economy to a post-industrial or service economy, with the older factories being replaced by smaller factories (computers, airplanes, appliances), requiring higher skilled workers. In effect these new factories were located outside the city in the suburbs. The central city would be left with nothing, and virtually no opportunities of any magnitude. Detroit is a city that I believe can be identified as the city which went through the greatest amount of change, being heavily relied on one industry. During the first half of the twentieth century, Detroit was probably the most economically booming city in the United States. Since about 1950, Detroit has gone from Aarsenal of democracy@, having one of the fastest growing populations and was home to the highest paid working-class workers as well, to losing nearly 1 million people. Many jobs were also lost with many business leaving the city of today empty and sometimes complete city blocks left completely empty. Detroit has also been home to a host of infrastructure woes, as can be reflected in many other cities in the Industrial Belt of the northeast with decaying roads, sewers, and other physical features.
When General Electric wanted to move their headquarters from Fairfield, Connecticut, where they have been stationed since 1974, they wanted to “be in a vibrant, innovative environment that would be stimulating to workers”(Saunders). They were offered a generous incentive package that was “estimated at $145 million, with $120 million in grants and programs from the state”(Saunders). Government intervention, in this case, helped General Electric move to Boston because they would be able to fully recoup their investment when relocating. Whenever thinking about whether one wants to relocate their business, they need to look at the ethics of it. Is it financially smart to relocate to this area? Well, for General Electric, this was financially smart
The solution of the second problem that Deere & John is facing about market access strategy may not work smoothly as its excesses capacity because Scott was given for 24 months to run the entire facility fully operational. Also this will be very difficult for Scott and his company because the time frame that was given is short so that
EXECUTIVE SUMMARY ........................................................................................................................ 1 1. INTRODUCTION................................................................................................................................... 3 2. STRUCTURAL INTEGRITY OF THE AUTO SECTOR ................................................................ 4 3. AN INTEGRATED MARKET ............................................................................................................ 12 4. LONG TERM OUTLOOK
General Motors is one of the world's most dominant automakers from 1931. After 1980s economic recession the main goal for automobile companies was cost reduction. Customers became more price-sensitive. Also Japanese competitors came into market with the new effective system of production. So market was highly competitive and directed toward price reduction. The case states that in 1991 GM suffered $ 4.5 billion losses and most part of the costs of manufacturing was due to purchased components. GM NA hired Lopez in order to find the way from "extraordinary" situation and reduce costs.
In 2000 , Nissan - a leading Japanese automotive company announced it would build an automotive plant in Canton Mississippi. The construction of the 3 million sq ft assembly plant - which was later expanded to 4 million sq ft. was expected to employ almost 4000 workers. And produce 250,000 cars per year , beginning 2003. The announcement of Nissan’s decision to build a plant in Mississippi came at a hefty price. Mississippi legislators approved $363 million worth incentives to Nissan - excluding other financial benefits that were awarded to Nissan and its tier 2 suppliers. This initiative was to further enhance Mississippi’s competitiveness to attract Nissan through the provision of physical infrastructure. Approximately $40.4 million was for site improvements while $80 million for recruiting and training.
Dear Sir, Enclosed is the report on “The Establishment of New plant”. This report examines the problems, options available and the different scenarios dealt with. Various factors have been taken into consideration for an attempt to take a wiser decision.
The characteristics of the global motor vehicle industry are a boom in certain places and a bust in others all due to economic conditions in different nations. Four years after tow of Detroit Michigan’s big three went into bankruptcy American car makers are going “full throttle” with sales in August hitting an annual rate that if substantiated can take them back over 16 million and that is a rate that was last hit before the economic crisis and 80% higher than 2009 when GM and Chrysler went into bankruptcy. The opposite is happening in Europe being in its sixth year slump now and with a weak economy, high petroleum prices and an aging