Introduction

 
Founded in 1908, General Motors Corporation, one of the world's largest
vehicle manufacturer, designs, builds and markets cars and trucks
worldwide

The case we have done is all about how General Motors entered India
through a particular segment and created a complete product portfolio, in
order to cater to all the segments in the industry. It expanded its product
line over the years and had created a premium brand for itself. In the year
2005, it entered the small car segment by introducing ‘Spark’. By the end
of 2012, General Motors planned to capture a 10% market share.. 

GM's vision is to be the world leader in transportation products and related

services, by unveiling new products and the most exciting lineup in its
history. The company will earn its customers' enthusiasm through
continuous improvement driven by the integrity, teamwork, and innovation
of GM's people.

GM employs 205,000 people in every major region of the world and does
business in some 157 countries. GM and its strategic partners produce cars
and trucks in 31 countries, and sell and service these vehicles through the
following brands: Buick, Cadillac, Chevrolet, FAW, GMC, Daewoo,
Holden, Jiefang, Opel, Vauxhall and Wuling. General Motors acquired
operations from General Motors Corporation on July 10, 2009.GM's global
headquarters are at the GM Renaissance Center in Detroit.

GM is investing aggressively in high technology and e-business within its

global automotive operations. 

Company’s Background:

Creation 1897-1909

1) It was found by William ‘Billy Durant on dec 16 1908’ in MI.

2) Started with Buick, then acquired Oldsmobile, and Oaks land
(Pontiac).

Acceleration 1910-1929

1) GM set the pace of production, design, and market innovations for

others to follow.
2) Added Chevrolet, Opel, Vauxhall.
3) Philosophy of “a car for every purse and every purpose”.

Emotion 1930-1959

1) During World War 2, GM still committed on innovation.

2) 100% of GM production was in supported the war including
 airplane, truck, tank.

Revolution 1960-1979

1) Due to environmental concerns, increase in Gas prices, GM did the

largest reengineering problem ever, with the age of lighter,
aerodynamic and fuel efficient vehicles.
2) Acted as a pioneer, an air bag, and reducing emission with catalytic
converter.
3) Also played a lead role, in developing guidance and navigation
system in Apollo 11.

Globalization 1980-1999

1) GM reinvented itself as an integrated global team and focus on

innovation growth.
2) Open the big plant in Spain, Joint venture with China and India.
3) Added Saab and Hummer to strengthen both the reach and variety
of vehicles sold worldwide.

Innovation 2000- till now

1) Environmental concerns about the energy, GM has created the

innovation vehicles.
2) More fuel-efficient engines to biofuels and hybrid, and hydrogen
fuel cells.

Structure of general motors

 In 1923 GM opened its first assembly operation outside North
America
– GM International in Copenhagen, Denmark. One year later, GM
Continental in Antwerp, Belgium, became the second assembly
operation. Initially, both operations assembled Chevrolet cars.

 In 1925,GM acquired Vauxhall Motors in Luton, UK.

1929,GM acquired Adam Opel in Germany.
In 1989, GM acquired 50% of Saab Automobile, Sweden.

 GM acquired the remaining 50% of Saab Automobile in 2000.

General Motors Europe, which has its headquarters in Zurich, was
established in 1986.
  In 2000, GM and Fiat reached agreement on an alliance, with GM
taking a 20% stake in Fiat Auto and the Italian company taking a 5.1%
stake in GM.

Fostering Global Partnerships and Consumer Relationships

GM is the majority shareholder in GM Daewoo Auto & Technology Co. of

South Korea, and has product, powertrain and purchasing collaborations
with Suzuki Motor Corp. and Isuzu Motors Ltd. of Japan. GM also has
advanced technology collaborations with Chrysler LLC, Daimler AG,
BMW AG and Toyota Motor Corp. and vehicle manufacturing ventures
with several automakers around the world, including Toyota, Suzuki,
Shanghai Automotive Industry Corp. of China, AVTOVAZ of Russia and
Renault SA of France.

GM brought brand differentiation to the world back in the 1920s, when

Alfred Sloan created the price ladder of GM marques that offered “a car for
every purse and purpose.”
Today the GM product revolution again is strengthening its brands, with
more innovative marketing that better understands the customer. Witness
the incredible renaissance of Cadillac, led by all-new cars and trucks that
have gone in a unique design direction, and by marketing that really
connects with potential buyers. Designing, building and selling great cars
and trucks that people really want to own. That's the fundamental business
of General Motors. Compelling designs excite customers and connect with
them on an emotional level. Well designed vehicles turn heads and fire the
imagination.
 Total Global
Year Production
(thousands)[13]

2007 9,286

2008 8,144

2009 6,503

Ran
Vehicl Market
k
Market/Region e share
in
sales (%)
GM

1 North America 3,552 21.9%

2 China 1,095 12.0%

3 European Union 905 12.3%

4 South America 815 20.8%

The following table is a comparison (estimates) of the new GM and the old GM:

Old GM (before July 10,

New GM (after July 10, 2009)
2009)

Vauxhall, Pontiac, Chevrolet,

Cadillac, GMDaewoo
Vauxhall, GMDaewoo (70.1%), Chevrolet,
(48.2%), Hummer, GMC, Brands
Cadillac, GMC, Holden, Buick, Opel
Saturn, Holden, Saab, Buick,
Opel

U.S.
5,900 5,000
Dealerships
 U.S. Treasury, Canada Development Investment
Common shareholders,
Corporation, Government of Ontario, Old
bondholders and secured Ownership
GM bondholders, and the United Auto
creditors
Workers sponsored VEBA

47 U.S. Plants 34

US$94.7 billion Debt[42] US$17 billion

U.S.
91,000 68,500
employees

GM worldwide vehicle sales by country 2008[14]

(thousands)

Rank
Vehicle Market
in Country
sales share (%)
GM

1  United States 2,981 22.1%

2 1,095 12.0%
 China

3 549 19.5%
 Brazil

4  United Kingdom 384 15.4%

5 359 21.4%
 Canada
 6 338 11.1%
 Russia

7  Germany 300 8.8%

8  Mexico 212 19.8%

9  Australia 133 13.1%

10 117 9.7%
 South Korea

11 114 4.4%
 France

12 107 7.8%
 Spain

13  Argentina 95 15.5%

14 91 33.3%
 Venezuela

15 80 36.3%
 Colombia

16 66 3.3%
 India

General Motors in Europe.

Structure:

In 1923 GM opened its first assembly operation outside North America – GM International in
Copenhagen, Denmark. One year later, GM Continental in Antwerp, Belgium, became the
second assembly operation. Initially, both operations assembled Chevrolet cars. In 1925, GM
acquired Vauxhall Motors in Luton, UK. Four years later, in 1929, GM acquired Adam Opel
in Germany. In 1989, GM acquired 50% of Saab Automobile, Sweden. Then, the company
established joint ventures with RABA in Hungary and with Automobilwerke Eisenach
(AWE) of East Germany in 1990. More recently, joint ventures were concluded with FSO in
Warsaw, Poland, in 1992, and with ELAZ in Tatars tan, in 1995. GM acquired the remaining
50% of Saab Automobile in 2000. General Motors Europe, which has its headquarters in
Zurich, was established in 1986.

In 2000, GM and Fiat reached agreement on an alliance, with GM taking a 20% stake in Fiat
Auto and the Italian company taking a 5.1% stake in GM. Giovanni Agnelli, honorary
chairman of the Fiat group, has since said that Fiat will not ask to use the put option which
covers the remaining 80% of Fiat Auto. Under the alliance, GM and Fiat agreed to set up
purchasing and power train joint ventures.

In order to optimize GM's expanding multi-brand product offering for the customer, efforts to
significantly strengthen the GM presence on a national level are planned by means of
consolidating local Opel and Saab distribution organizations under a GM umbrella
organization. This new approach will increase the focus on the GM brand and provide a
flexible multi-brand platform that can accommodate potential future additions. A phased
approach will be taken to implement this concept in selected European countries.

Alliances:
Honda and GM plan to team up over vehicle recycling in Europe. Honda will use the GM
group's recycling network to collect scrapped vehicles across Europe, and the two car makers
will also exchange information on technology to disassemble vehicles and produce recycle -
friendly automotive parts. The alliance is intended to reduce costs because regulations
requiring automakers to collect scrapped vehicles free of charge were expected to be
introduced in Europe from July 2002.

MMC Norilsk Nickel: In October 2002, GM and MMC Norilsk Nickel signed a long-term
palladium, platinum and rhodium supply contract. For Norilsk, the deal forms parts of a
strategy to boost the number of long-term deals with end-users to ensure stability of platinum
group metals deliveries and prices.
AvtoVAZ In June 2001, GM signed a General Framework Agreement for a joint venture
with AvtoVAZ, the Russian car manufacturer. Under the terms of the agreement, GM and
AvtoVAZ each hold a 41.5% stake in the joint venture and the remaining 17 % share is
owned by the EBRD. The project is worth $332 million. The venture’s vehicle, based on a
Russian-developed platform, will be sold in Russia under the name Chevy Niva. Production
is expected to reach 75,000 units annually. The start of production in Togliatti is planned for
2002.

GM and Fiat are to start the cross-supply of engines in 2002 with the Fiat 1L FIRE petrol
engine appearing on the Chevrolet Celta built in Argentina. In the same year, Opel will
introduce a 16v version of the Fiat 1.9L common-rail diesel unit on the Astra range in
Europe. The Fiat Stilo, to be produced in Brazil by late 2002, will be powered by GM
Chevrolet petrol engines.

In March 2003, Fiat and GM were reported to be at an 'analytical phase' in their convergence
plan for the C-segment, according to Fiat. They are expected to develop a common platform
for future generations of the Fiat Stilo and Opel Astra. An all-new Astra is to be presented at
the Frankfurt Motor Show and go on sale early in 2004. The new model uses an evolution of
the current Astra T-platform. The Middle Range Architecture platform would be the basis of
the replacements for the Stilo in 2007 and the eventual successor to the new Astra.

GM’s Global Network of Partners

COUNTRY COMPANY YEAR

Australia Isuzu – General Motors Australia Ltd 1988
China Jinbei GM Automotive Company Ltd 1992
China Shanghai GM Corp Ltd 1997
China Pan Asia Technical Automotive Centre 1997
Co Ltd
Ecuador OBB 1981
Ecuador AYMESA 1982
Egypt General Motors Egypt SAE 1983
Japan Isuzu Motors Ltd 1971
Japan Suzuki Motor Company 1981
Japan Fuji Heavy Industries (Subaru) 1999
Kenya General Motors Kenya Ltd 1977
Russian AvtoVAZ 2001
Federation
South Africa Delta Motors Corp Ltd 1997
Employees: 73,000

Product Range:

Opel/Vauxhall: Agila, Corsa, Combo Tour, Astra, Astra Coupe, Astra Cabrio, Meriva,
Zafira, Vectra, Signum, Omega, Speedster, Frontera, Corsa Van, Combo, Astra Van, Vivaro,
Movano
Saab: 9-3, 9-5.

Plants:

GM Europe has 16 Opel/Vauxhall production sites in ten countries in Europe, while products
bearing the Opel brand, including vehicles based on Opel technology, are manufactured in an
additional 16 plants on four continents. Plants in Colombia, Ecuador, Egypt, India, Indonesia,
South Africa and Venezuela assemble CKD units. The factories in Mexico, Brazil and
Australia are totally independent manufacturers of complete vehicles and components.

Sales:

In 2002 GM Europe achieved total vehicle sales in western and central Europe of 1.64m
units, representing a market share of 9.2%. Opel/Vauxhall total sales reached 1.56m vehicles,
resulting in a market share of 8.8%.

Financials:

In 2002, GM Europe’s adjusted loss was $549m compared with $767m in 2001.The drop
was attributed to material, structural, and other cost improvements. This was partially offset
by a decrease in wholesale volumes driven a weak European industry and continuing
competitive
pricing pressures.
Production:

Plant Highlights:
GM/Opel's plant at Figueruelas in Spain is to be the sole unit producing the new Meriva for
the European markets. The Latin American market will be supplied from the Sao Jose dos
Campos plant in Brazil under the Chevrolet badge. With the Meriva, Figueruelas will be
working at full
capacity. Initial forecasts are for production of around 920 units a day, with the Corsa
accounting for the remaining capacity. Some Corsa production could be transferred to the
Eisenach plant in Germany should demand for the Meriva exceed expectations. Series
production of the Meriva started on 7 January 2003. Output in the first year will total 170,000
units.
Opel Espana plans to produce 200,000-220,00 units of the Meriva a year when full
production is reached.
In April 2003, GM said it was to invest several hundred million dollars in its plant at Gliwice,
Poland, for the production of the second-generation Opel Astra and spare parts for the model.
The investment comes under an offset agreement, in the form of direct US investments, for
the acquisition by Poland of 48 Lockheed Martin F-16 combat aircraft.

Prospects:
Saab is aiming to break even in 2004, helped by the restructuring programme announced in
November 2002.

Peter Augustsson, head of Saab, has said that the restructuring, which includes 1,400 job
losses, will reduce breakeven point to an annual sales level of 130,000-140,000 cars. In 2002,
Saab sold around 120,000 cars and sales should be boosted over the next few years by the
new 9-3. Production of the 9-3 and 9-5 is being moved to the same assembly line and
engineering operations are being integrated with GM Europe.

Opel Espana is hoping the launch of production of the Meriva at the Figueruelas plant and its
cost-cutting efforts will take it back into the black in 2003, after three years of losses. Output
should reach 458,000 units in 2003, with the plant operating at maximum capacity. In 2002,
Opel Espana made a loss of Euro 64.5m, 20% down on 2001, while revenues rose by 3.3% to
Euro 5,351m.

Opel is sticking to its ambitious profit target, despite the decline in the European car markets.
Carl-Peter Forster, chairman, is planning to achieve an operating profit by the fourth quarter
of 2003 through additional cost cuts. In the first five months of 2003, Opel sales in Germany
rose by 9.7% to 150,000 units, while sales in western and central Europe as a whole fell by
2%. According to Mr Forster, June was a 'dreadful' month.In July 2003, GM reaffirmed that it
will make a loss of up to $200m on its European operations in 2003, and that it will return to
profit in 2004.

General motors in-

North America
Core brand focus

In North America, GM will focus primarily on its four core brands — Chevrolet, Cadillac,
Buick, and GMC — while selling, discontinuing, or scaling back its other brands. The White
House characterized the GM restructuring as a shift toward a new leaner, greener GM, which
will aim to break even with annual sales much lower than previously stated.[46] President
Obama declared that the restructuring "will mark the end of an old GM, and the beginning of
a new GM; a new GM that can produce the high-quality, safe, and fuel-efficient cars of
tomorrow; that can lead America towards an energy independent future; and that is once
more a symbol of America's success

Canada
In March 2005, the Government of Canada provided C$200 million in incentives to GM for
its Ontario plants to expand production and provide jobs, according to Jim Harris. Similar
incentives were promised to non-North American auto companies like Toyota. Ontario
Premier Dalton McGuinty, said the money pledged for the project by the Government of
Ontario and by the federal government was well spent.[63]

Iran
In 1974 GM has bought the Jeep Company which is located in Tehran. Today the firm is
known as Pars Khodro as a part of SAIPA. From 1974 up to 1980 and then from 1984 up to
1987 they were CKD assembling different GM vehicles. The first model was the Chevrolet
Iran (1974–1976) followed by the Chevrolet Nova and the Buick Skylark. In 1977 GM
introduced the Cadillac Civil to the Iranian market. Due to political disputes, GM has stopped
the assembling of these models in the late 1980. After the Islamic Revolution, GM returned
to Iran in 1984 with its Chevrolet Pickup. But there wasn't the hoped-for success. This was
the reason why GM stopped its Iranian presence in 1987.
Uzbekistan
Since 2008 GM is manufacturing Chevrolet cars in Uzbekistan. The company was founded as
a joint venture with the OJSC UzAvtosanoat and is known under its name GM Uzbekistan. A
separate firm, known as GM Powertrain Uzbekistan is manufacturing engines for the local
plant. But there are a lot of other firms of GM which are producing other components for GM

Egypt
General Motors has a long history in Egypt which began in the 1920s with the assembling of
cars and light pickup trucks for the local market. In the mid of the 1950s, GM withdrew from
the Egyptian market. Some year later, the Ghabbour Brothers began to
assemble Cadillac, Chevrolet and Buick models up to the 1990s.

Since 1983 GM and Al-Monsour Automotive Company has founded the General Motors

Egypt which is currently the only manufacturer of traditional GM branded vehicles in Egypt.
The Speranza Motors is a big company which started in the 1990s with the SKD assembling
of Daewoo cars. Today the main products of Speranza are from the Chinese Chery concern.
[edit]Global ranking

GM officially ranks as the world’s second largest manufacturer as measured by OICA in

2009.[69]

Current brands
 Years
Global Strategy: A Brand for
Marque Markets

Every Place
used

 Buick since 1908 North America, China, Israel, Taiwan

This article explains the international business

 Cadillac since 1909
Global (except South America, India, SE Asia,
Australia) strategy for the, at the time, largest automobile seller
in the world. The international business strategy for
General Motors is almost exactly opposite of its
 GMC since 1912 North America, Middle East
competitors, G.M. likes having many flagship
manufacturers to allow each demographic of
 Chevrole since 1917 Global (except Australia, New Zealand, South Korea,
Vietnam)
consumers in each region a proper selection, unlike
t
its American Competitor, Ford, who is trying to
streamline its international lines. It talks about what
 Vauxhall since 1925 United Kingdom
type of consumer will buy which type of car they
produce. They also state how the types of cars
 Opel since 1929
Europe (except UK), Africa, Asia, Oceania, South
America
desired in each area tend to change over the years,
for example GMC trucks use to be a mainly
domestic product where now in the Middle East sales
have risen six-fold since 1999.
General Motors used of multi-domestic strategy is
very good, it is great to review the local consumers
and get them the vehicles that they want. However, I
feel that the company has over stretched its lines. I
feel that even internationally you can buy a Vauxhall, Chevrolet, Saab, Cadillac, Hummer,
Opel, Buick or GMC and not leave the General Motors company brands, the company has
gone too far.
company did a go through a good global strategic planning process when they decided to do
the multi-domestic strategy. But the multiple brands also is a lot more costly, due to the need
to examine multiple markets and analyze what the demographic wants in a car. Then to
design and make a separate car for all those different markets, General Motors, I feel did not
look at the cost of working with the multi-domestic style other then the home replication,
where they could just remake the same products abroad as they do within the United States.

GM’ s current Strategic Plan

1. Reduce labour expenses

2. Cut legacy costs

3. Decrease production capacity

 4. New designs and marketing strategies

 Costs reduction do not guaranty successful competition

 GM must differentiate its products for customers to get a sense of value-added
 Must appeal to needs and trends of local markets instead of using a global

Corporate Level Strategy & Organizational Structure

- Multi Divisional Structure

- Centralization of key processes

- Regions represent autonomous Strategic Business units

- Brands are a subdivision of the SBU’s with minimum control over processes

- Minimal links to identical brands in different regions

Problems with Current Structure

1)Structure focuses on cost reductions

2)Direct conflict with the intended integrated differentiation/cost leadership strategy

3)Brand level management is almost inexistent at the SBU level which results in lack of
differentiation

4)Regional SBUs do not have enough control over their regions.**

General motor’s strategic board

Why did general motors did not succeed?

If General Motors Corp. (GM ) were any other company, its problems would have sorted
themselves out a long time ago. Logic says that when your cash holdings exceed your entire
valuation in the stock market, some Wall Street shark is going to swoop in, snap up the good
parts, and toss the rest. Companies with bloated factories and workforces got religion the hard
way 20 years ago, in the days of "Neutron Jack" Welch. And with today's more active boards,
CEOs who consistently lose ground to the competition usually don't need Donald Trump to
tell them they're fired.

Worst of all, GM reached a watershed in its four-decade decline in market share. After losing
two percentage points of share over the past year to log in at 25.6%, GM has reached the
point at which it actually consumes more cash than it brings in making cars, for the first time
since the early '90s. GM, once the world's premier auto maker, is now cash-flow-negative.
That's a game changer. Without growth, GM's strategy of simply trying to keep its factories
humming and squeaking by until its legacy costs start to diminish is no longer tenable. If
market share continues to slip, its losses will rapidly balloon.

Normally a company in such straits contracts until it reaches equilibrium. But for GM,
shrinkage is not much of an option. Because of its union agreements, the auto maker can't
close plants or lay off workers without paying a stiff penalty, no matter how far its sales or
profits fall. It must run plants at 80% capacity, minimum, whether they make money or not.
Even if it halts its assembly lines, GM must pay laid-off workers and foot their
extraordinarily generous health-care and pension costs. Unless GM scores major givebacks
from the union, those costs are fixed, at least until the next round of contract talks in two
years.

Gm’s global strategy

In Britain, you can buy a Vauxhall, a Chevrolet, a Saab, a Cadillac or a Hummer. On the
Continent, you can trade in the Vauxhall for an Opel. In China, perhaps you’d prefer a Buick,
in Dubai a GMC. How about a Holden? Well, you’ll have to travel to Australia or New
Zealand. But they are all General Motors brands.

As Ford Motor streamlines its global business around its flagship brand, moving to divest
itself of nameplates like Aston Martin, Jaguar and Land Rover, General Motors is sticking to
a different international marketing strategy. Rather than focus on one brand, it wants
consumers to be able to choose from a fleet of them.

“How do you cover an area so diverse with a proposition that’s valid across the entire
region?” he said. “You can’t do that with one brand. You have to have a portfolio.”

The increase in international sales helped G.M. retain its position as the world’s largest
automaker last year, narrowly fending off a challenge from Toyota. Though January was a
surprisingly good month for G.M. in North America, like other American automakers it has
been struggling for years in the domestic market. But in the European region, G.M.’s sales
rose 9 percent, to 2.2 million vehicles, last year. In Asia, sales were up 15 percent, to nearly
1.5 million cars.

GMC’s annual sales in the region have risen sixfold since 1999, to more than 30,000
vehicles. G.M. is aiming the Yukon at well-to-do consumers in the Middle East.

In the less affluent countries of Eastern Europe, the Chevrolet brand has shown strong
growth. G.M. sold more than 450,000 Chevrolets in the region last year, only a few years
after the brand was introduced there.

At a time when some American marketers are playing down their origins abroad, General
Motors has been promoting Chevrolet in Europe with a bit of American.
SWOT Analysis
Strengths
1. Large Market Share
Although GM's market share in the US has dropped it is still very much competitive at 26
percent.They also have an increasing share in the Chinese market. With the right decisions
there is noreason for GM to not become the automotive leader it once was.
2. Global Experience
As explained above even with GM's recent decline they still have the market share and
theexperience to bounce back. They have been a worldwide company for nearly a century
now andhave established themselves as the global leader for most of them. If you recall I
mentioned abovethat a current opportunity for GM is to expand globally and as we can see
they already have theexperience to do so. It is just a matter of the correct planning and proper
implementation of thoseplans that will decided whether or not GM's goals are achieved.

3. Variety of Brand Names

GM as I mentioned has been the automotive leader for the majority of the last century. A
largereason for that is the wide variety of quality brand names that appeal to all target
markets. Thecurrent GM brands include: Chevrolet, GMC, Cadillac, Buick, Pontiac, Saturn,
Hummer, Saab,Daewoo, Opel, and Holden.

Weaknesses

1. Behind on Alternative Energy Movement This is GM's biggest weakness. The alternative
energy/hybrid trend has begun to take place in the automotive industry and GM has been one
step behind the competition in terms of alternative energy vehicles. This has led to many
problems including loss of market share and a decrease in company profit. In order for any
automotive company to be successful from this point forward they must be Hybrid friendly
and fuel efficient.

2. Poor Organizational Structure As we can see in exhibit 1 of the case GM's organizational
structure seems to be too vertically integrated. This causes a lack of communication between
employees from top to bottom and may have played a part in GM falling behind on the
alternative energy movement.

3. Stagnant Profitability Looking at GM's profit we see that they are certainly struggling with
respect to the size of their company. Their profit margin was about 1.5% and the ROE has
dramatically decreased over the recent years dropping to 10% in 2004. This is a situation that
shareholders will not be pleased with.

4. Overly Dependent on US market GM has become too dependent on the US market

and must take advantage of the opportunity to expand globally.competition is
becoming too strong to focus on just one country.

Oppurtunities

1)alternative energy movement- It is obvious that GM was behind its competition with
regards to the research and development of hybrid vehicles. However hybrid technology is
still very much new giving GM the opportunity to once again become the automotive
industry's leader in innovation and technology.

2. Continuing to Expand Globally. Recently GM saw an increase in the Chinese automotive

market, which proves their needs to be more emphasis put on foreign markets. If GM can
infiltrate these markets and successfully grow along with their continuing focus on the US
market they will be headed in a positive direction.

3. Low Interest Rates With the right marketing strategy the low interest rates have the
potential to generate an immediate increase in sales.

4. Develop New Vehicle Styles and Models This is an opportunity that will never be
satisfied, meaning that GM should always be attempting to develop the automotive world's
most popular vehicles, and as we know, what is in today will be out tomorrow.

Threats-

1. Rising Fuel Prices With GM being a large producer in both trucks and SUV's, sales have
drastically decreased due to the lack of fuel efficiency. The rise in fuel prices has played a
significant role in creating the opportunity for development of both hybrid and more fuel
efficient vehicles. As you will find with most threats, an equal opportunity will usually
emerge as is the case here with GM's opportunity mentioned above.

2. Growth of Competitors GM no longer has the luxury of being the known leader in the
automotive industry and faces the reality that they are in serious trouble. As I mentioned
earlier Toyota took the first step in the direction of hybrid technology and has since
drastically grown and become the questionable automotive frontrunner to start the 21st
century.

3. Pension Payouts. Part of this threat is their own doing and the other is simply unavoidable.
GM is responsible for providing generous pension benefits to its employees, which at the
time seemed like a great idea, however they are now experiencing problems as more and
more people begin to collect.

Efforts to maintain its standard

Becoming efficient is GM's key goal right now, both in bringing back its own financial
security and at the same time convincing the auto industry task force to provide crucial loans.

To achieve this goal, GM will be trying to preserve its global product strategy that helps it
reduce costs for model development by creating cars for global markets rather than specific
regions. This task may become more difficult over the next few months, especially
considering the state of GM's Opel subsidiary based in Germany and its own financial
troubles.

But problems may crop up where GM is requesting financial help from third-parties in
exchange for equity stakes in their brands - as is the case with the German government and
Opel. If the German government were to claim control of Opel with a majority shareholding
of stocks, it remains uncertain who would be in charge of running the company, especially in
regards to GM's global development plans. The same could occur for its Holden
and Daewoo subsidiaries. 

GENERAL MOTORS AND ITS PATH TO INTERNATIONALISATION

Introduction Internationalisation concerns the process through which a firm increases its
reliance on foreign markets and countries as a means of growth and financial performance
improvement. The main components of a firm's degree of internationalisation consist of the
number of countries in which the firm has foreign business operations and the number of
diverse social cultures of the countries in which the firm operates and the geographic
diversity of the foreign market.

Thus, the degree of internationalisation reflects the various differences across the countries
and markets in which the firm undertakes foreign operations. General Motors Corporation
(GM) is the world's largest automaker employing over 325,000 people in 32 countries. In
2006 it sold over 9 million cars and trucks globally in 5 continents with a global market share
of 13.5 %. Internal and external triggers of Internationalisation The economic world has
shifted from being a cluster of national economies to a global and more interdependent
marketplace, based on line import, export and distribution of products, services and
information around the world.

GM have been involved in a range of global ventures aimed at extending the carmakers
market penetration and also increase its market share as well as sales. GM used exports,
acquisitions, joint ventures and strategic alliances to enter foreign markets based on business
considerations, that is, consistent with strategic fit.Global sourcing is mainly done to reduce
production costs, and it has been often adopted in parallel with concentrated purchasing and
platform unification among strategically allied companies and regional divisions worldwide.

The GM strategically allied with Fiat in 2000 by acquiring 20 percent of Fiat's equity to
establish a joint procurement venture of 50 percent capital each for concentrated purchasing
of about $32 billion per annum .This alliance have the capacity to strengthen their bargaining
power as well as reducing the supplier management cost.

A key issue in internationalization is the need to adapt to cultural characteristics.Consumer

attitudes toward foreign goods and services, and their perceptions of country of origin and of
foreign business are important factors when assessing the potential of markets. The number
of younger, higher-income consumers with increasing demand for goods and services living
in the emerging markets continues to grow, these markets become increasingly attractive and
the need to assess the receptiveness of these consumers to foreign brands and business
becomes important .

* Benefits of Internationalisation to General Motors By internationalising, a firm is able to

increase the range of distinctive resources that are likely to come across and can potentially
use for value creation. GM expanded its capabilities in manufacturing through technological
competences. This was achieved by forming subsidiaries, alliances and joint ventures with
other automobile companies in different parts of the world (See appendix2). Automobile
companies pursuing a global strategy often look to global ventures to help them with new
product development, branding, procurement, marketing, account management, pricing and
market intelligence. According to the company has been involved in a range of global
ventures throughout its history, each of which has aimed at extending the carmakers market
penetration. Partnering enables GM to rapidly expand its technical fields and bring that
knowledge to bear on corporate problems. Through the various stages of internationalisation,
GM was able to expand distribution and provide access to materials. Additionally, the
company developed and improved its operations, facilities and processes.

It also provided access to new technology, new knowledge and new capabilities.
Furthermore, internationalisation of GM provided them with capabilities that allow them to
improve their product offerings .

Capabilities of this type tend to relate to functions like research and development, production,
sales, and distributing was able to gain operational efficiencies through concentrating their
activities to a limited number of favourable locations to supply multiple markets to gain
economies of scale leading to profitabilitabitility.

Multinational companies (MNCs): multidomestic, international, global and transnational

structures. GM as a successful MNC has developed an effective system of transferring its
human resource management capability as well as technical knowledge across its overseas
operations. argues that this transferability can also form a kind of special competitive
capability for an MNC that may be difficult for competitors to imitate. cultural considerations
which they should be aware of in managing in different countries. Transferability of human
resource management is influenced not only by factors at national and company levels but
also by the knowledge and innovation characteristics of the HRM practice transferred.

The automobile manufacturers such as GM have regional headquarters location for systems
hence adopting the multinational company functionality provides these firms with the ability
to manage their global supply chains while still localizing their products and operations to a
specific geographical area
Another reason that GM has adopted this strategy of configuration is their size and scope.
Their size suggests that a single installation in a centralized location would present problems
and increase the costs of global communication.. General motors have taken advantage of its
competences in the automobile industry to form alliances and partnerships to penetrate into
foreign markets. Through these practices GM have also developed competences in the
transferring of technology and human resource capacity into competitive advantage.