Top 10 Car Manufacturers: General Motors Corporation
#4: General Motors Corporation
A brief history
General Motors was established in Flint, Michigan in 1908 by William Durant, initially as a holding company for the Buick Motor Company. By 1910 it had rapidly acquired more than 20 smaller car manufacturers and auto accessory suppliers, including Oldsmobile, Cadillac, and Oakland (now known as Pontiac).
After going on to found Chevrolet, Durant returned to head General Motors in 1915, where he remained until 1923 when the company moved its headquarters from Flint to Detroit, and Alfred P. Sloan became president.
In 1925 GM bought Vauxhall of England then in 1929 acquired an 80% stake in German auto-manufacturer Opel. In 1931 this was increased to 100% and GM also acquired Holden of Australia.
In the 1930’s GM was rocked by bitter strikes by its hourly workers in Flint, and in 1937 GM recognized the United Auto Workers (UAW) as the bargaining representative of its employees. Meanwhile it continued its policy of acquisition, branching into the aviation and railroad industries by buying Fokker aircraft Corp. of America, and railcar builder Electro-Motive Corporation.
During World War II GM became a producer of armaments, vehicles and aircrafts for the allied war effort, and civilian production was halted in 1942. The UK division of General Motors, Vauxhall, produced the Churchill tank series, while in the U.S. GM was the top producer of U.S. army 11/2 ton 4x4 vehicles.
By the mid 1950’s GM’s U.S. market share had reached 54%, and in 1955 it became the first American corporation to pay taxes in excess of $1 billion. The 1960’s saw the creation of compact and intermediate classes, in part to rival the influx of small European cars such as the Volkswagen Beetle. GM’s Chevrolet Corvair was the ill-fated response to the VW classic, but it was discontinued by 1969 after developing a poor reputation with the public.
The different divisions within GM were originally structured so that each was a ‘step up’ in terms of luxury and affordability, but by the 1970’s most of GM’s vehicles were built on a few common platforms, and the lines between these divisions were much less defined.
GM acquired stakes in several more motor companies during the 1980’s including Suzuki Motor Corp., and British sports car maker, Lotus. It also founded a joint venture with Toyota Motor Corp. to build cars at GM’s plant in Fremont, California. In 1987 the company signed a contract with the UAW prohibiting the closure of plants unless its product sales fall.
In 1988 revenue hit $123.6 billion, and earnings rose to $4.6 billion, but the early 1990’s saw economic recession hit GM hard and in 1991 the company lost a record $4.45 billion. Then President, Robert Stempel announced the forthcoming closure of 21 plants, resulting in the loss of 9,000 salaried and 15,000 hourly jobs in 1992. In 1998 a 56-day strike at GM’s Flint stamping operations shut down almost all of the company’s North American assembly plants.
After a difficult time during the 2000’s, GM announced an industry record loss in 2007 of $38.7 billion. By 2008 GM warned that its liquidity would fall short of that needed to run its business in the by the first half of 2009, and in December 2008 GM and Chrysler were granted $17.4 billion in government loans.
General Motors subsequent bankruptcy and government bailout resulted in the company being re-incorporated as General Motors Corporation in 2009.
|Headquarters||Detroit, MI, USA|
|Revenue (2013)||$155.4 Billion|
|Pre-tax profit (2013||$8.6 Billion|
|Employees worldwide||219,000 approx.|
|Vehicle sales (2013)||9.7 Million|
Mary Barra became the first woman ever to head one of the ‘big 8’ U.S. automakers, when she was appointed as General Motors CEO in January 2014. Barra began her career with GM as a General Motors Institute (Kettering University) co-op student at the Pontiac motor division. Having served in several positions within the company, she went on to serve as Senior Vice President, Global Product Development, and Executive Vice President, Global Product Development, Purchasing and Supply Chain, before taking up her current role.
Her biggest task as CEO has been to deal with the huge level of recalls that have hit GM during the first half of 2014. As of June 2014, GM has recalled over 29 million vehicles this year – more than three times the amount it sold worldwide in 2013, and more than the total industry recalls in the U.S. in 2013. She has already been summoned by Congress to answer questions about GM’s conduct in relation to faulty ignition switches linked to 13 deaths, and faces the challenge of rebuilding consumer confidence in the company.
Under her leadership, GM’s mission is ‘driving to become the global industry leader in automotive design and technology, product quality, customer care and business results’.