007).
When considering those firms with sales in excess of $500 million, which is the category in which both Ford and General Motors participate, the industry as a whole operates with an acceptable, but not high, current ratio of 1.53:1 in 2007. This has remained steady from the 2005 and 2006 figures of 1.58:1 and 1.55:1, respectively. Inventories have been high during these three years since the quick ratio falls to 1.15:1 in 2007. Profit for the industry has also been low, with return on sales falling precipitously from 2.18 percent in 2005 to 1.02 percent in 2006 and then recovering to 1.81 percent in 2007. These are razor-thin margins, however ("Industry," 2008).
General Motors was once a major industrial powerhouse in the United States; its chairman was once famously misquoted as saying, "What's good for General Motors is good for America" ("Engine Charlie," 1961). Today, General Motors remains the premier car company in the United States, but its market share has fallen significantly to the point where, in 2007, General Motors had a 20.1 percent market share compared with Toyota's 19.8 percent share and Ford's 16.8 percent share ("United States," 2007).
General Motors sells its cars and trucks not only in North America but throughout the world. Its brands include Cadillac and Chevrolet, among others, and it has been successful in the heavy pickup truck market. In addition, it has a minority ownership stake (49%) in GMAC, a financial and insurance company which originally was wholly owned by General Motors.
Despite its long history and its broad range of products, the company has not been able to operate profitably recently. The company posted net losses of $10 billion in 2005, and nearly $2 billion in 2006; these represent net loss margins of -5.3 percent and -1.0 percent, respecti
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