Problems Facing General Motors

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General Motors is one of America's biggest corporations. It would seem to be very successful, but it is having problems today. A lot of large companies are having troubles today along with small companies. The recession is one of the reasons, but there are other reasons too. General Motors has a long history, and during that time it has changed its management and its management style several times. The way the company is administered has something to do with the troubles it is having today. It is having so many troubles that it is closing plants and firing people by the thousands. No one is sure if these measures will make enough difference to save the company. What should be done is an analysis of the company to see where the problems come from and how they might be solved. The Chairman of the company is resigning, but will this make the difference that is needed to save the company? Is it really his fault or is there some other reason why the company is having trouble? Is it only the recession, which means that the country will have to change before General Motors can get better?

The automobiles industry as a whole was very successful in the United States for a long time. Flint (1987) describes how the automobile business grew and how General Motors and Ford were giants in the automobile industry for seventy years. General Motors has dominated the industry for much of that time, and many times some people in Congress thought that General Motors was too dominan

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d technical and research skills and experienced executives that were considered the best in the world. However, the North American auto operations were not doing well in the 1980s anyway. All of the Big Three were having problems, but General Motors was falling the farthest. In 1990 it was selling one-third fewer cars than it had in 1979, and it lost nearly one billion dollars in 1989 alone. The company was producing very good cars, but it was producing them for a higher cost than were other manufacturers. Each car cost about $200 to $300 more than Ford's cars and $750 more to build than Japanese models made in the United States. The Japanese have been doing much better than the American companies, and nearly all of the market share gains made in the last ten years by the Japanese have been at General Motors's expense. Since 1979, General motors has lost 11.6 points and the Japanese have gained 10.4 points. When Stempel took over, it was known that the company would have to work fast to slow the damage and to turn the company the other way. The company had to spend more than one billion dollars to close unused factory capacity amounting to one million cars. The bureaucracy had to be reduced, and costs had to go down while
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Approximate Word count = 2762
Approximate Pages = 11 (250 words per page)

Problems Facing General Motors

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