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Problems Faced by GM - Papers

Problems Faced by GM

General Motors Corporation (GM) is a multinational automobile manufacturer founded in 1908 and headquartered in the United States. GM is the world's largest automaker as measured by global industry sales and has been the global sales leader for the last 77 years. As of 2008, General Motors employs about 266,000 people around the world. It manufactures its cars and trucks in 35 different countries and sells them under the brands of Buick, Cadillac, Chevrolet, GM Daewoo, GMC, Holden, Hummer, Opel, Pontiac, Saab, Saturn, Vauxhall, and Wuling. As of 2008, General Motors is the ninth largest publicly traded company in the world. In recent years the company has endured significant financial ...

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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.
With the rise of foreign competitors like Toyota, Honda and Nissan in the 1970's and 80's, rivalry in the American auto industry has become much more intense. Firms compete on both price and non-price dimensions. The price competition erodes profits by drawing down price-cost margins while non-price competition (e.g., new car rebates and interest free loans) drives up fixed cost (new product development) and marginal cost (adding product features).

Lack of differentiation opportunities

One of the other reasons there is such high rivalry is that there is a lack ...

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PAPER DETAILS

Added: 7/18/2011 06:49:18 AM
Submitted By: candywongpc
Category: Business
Type: Premium Paper
Words: 532
Pages: 2

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