General Motors

Group members• Binod Hyoju• Suman Baniya• Shaurya Challana• Aruna Thakur• Gaurav Govinda• Jayant Basnet

Presented to

• Dr. Lokesh Jindal

• Analysis of the challenge faced by the multinational organization, in maintaining, growing or divesting its business. (as per requirement of the EBM 587)

• To make audience aware of the General Motors (Management style, marketing strategies, distribution network etc.)

Objective of the presentation:

contents• Introduction• Vision of the company• Mission of the company• Brand of the company• List of countries by motor vehicle production• Global sales of GM (2008)• Model of Chevrolet available in market• Pricing • Environmental Analysis• Competitor’s Analysis• SWOT Analysis• Porter’s Five-Forces Analysis• Core Competence• Financial Results

Introduction

• The world’s second largest auto manufacturing company.

• Situated in united state with its head quarter at Detroit, Michigan.

• About 209,000 people are employed in the company in the major region.

• The business has been speeded in about 120 countries.

• The General Motors installed the world's largest rooftop solar power at their Zaragoza Manufacturing Plant in the fall of 2008.

• The Zaragoza solar covers about 2,000,000 sq. ft. of roof besides, it comprises about 85,000 solar panels.

Brand of the company

• Baric• GMC• Chevrolet • Cadillac• Daewoo • Holden• Isuzu• Jiefang • Opel• Vauxhall and Wuling

Vision of the company“GM’s vision is to be the world leader in transportation products

and related services. We will earn our customers’ enthusiasm through continuous improvement driven by the integrity, teamwork,

and innovation of GM people."

Mission of the company"G.M. is a multinational corporation engaged in socially

responsible operations, worldwide. It is dedicated to provide products and services of such quality that our customers will receive superior value while our employees and business partners will share in our success and our stock-holders will receive a sustained superior return on their investment."

General Motors Slogan

"People in motion."

General Motor Company in different continental

1. North America• GM is primarily focusing on Chevrolet, Cadillac, Buick, and GMC in

North America which are its core brand. 2. Asia• The Buick brand has a strong market in China. • In 2004, the Cadillac brand and Chevrolet in 2005 were exported

to China. • GM and the Chinese company SAIC had a joint venture on March

25, 1997 and the company manufactured the vehicles locally in Shanghai.

• But the Shanghai GM plant officially opened on December 15, 1998 and the first Chinese-built Buick came off the assembly line.

• The sales were increased by GM in China in March 2010 by 68 percent to 230,048 vehicles. Besides, GM increased the sales in U.S. by 22%. And it was noticed that the company would be able to sell more than 2 million vehicles in China in 2010.

3. Africa• In 1920, General Motors was established in Egypt with the

purpose of assembling the cars and light pickup trucks for the local market.

• At about the mid of 1950, the GM withdrew from the Egyptian market. But the year later, the Ghabbour Brothers, till 1990, started to assemble Cadillac, Chevrolet and Buick models.

• The General Motors Egypt was founded in 1983 by GM and Al-Monsour Automotive Company.

• It is currently only the manufacturer of traditional GM branded vehicles in Egypt.

List of countries by motor vehicle production

13790994; 29%

7934516; 17%

5711823; 12%

5209857; 11%

3512916; 7%

3182617; 7%

2632694; 6%

2170078; 5%

2049762; 4%1557290; 3%

China Japan United States Germany South Korea

Brazil India Spain France MexicoChina

Japan

United St

ates

German

y

South Korea

Brazil

IndiaSp

ainFra

nce

Mexico

0

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

Series1

Global sales of GM (2008)

2981000; 46%

1095000; 17%

549000; 8%

384000; 6%359000; 6%

338000; 5%

300000; 5%

212000; 3%133000; 2% 117000; 2%

United States China Brazil United Kingdom Canada Russia

Germany Mexico Australia South Korea United St

ates

ChinaBraz

il

United Kingd

om

Canad

aRussi

a

German

y

Mexico

Australi

a

South Korea

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

Series1

Model of Chevrolet available in market

• Chevrolet Beat• Chevrolet Spark• Chevrolet Aveo U-VA• Chevrolet Cruze LT• Chevrolet Captiva LTZ AT• Chevrolet Tavera• Chevorlet Optra

Pricing • Chevrolet Beat

Chevrolet Beat 1200 CC Available Models: 1.2 PS 1.2 LS 1.2 LT 1.2 LT Options   NRs 1,840,000

• Chevrolet Spark

Chevrolet Spark Available Models: 1.0 1.0 PS 1.0 LS 1.0 LT NRs 1,650,000

• Chevrolet Aveo U-VA

Chevrolet Aveo U-VA Available Options: Aveo U-VA 1.2 Aveo U-VA 1.2 LS Aveo U-VA 1.2 LT NRs1, 895,000

• Chevrolet Cruze LT

Chevrolet Cruze Available in : LT LTZ MT LTZ AT NRs 4,500,000• Chevrolet Captiva LTZ AT

Chevrolet Captiva LTZ AT NRs 5,900,000• Chevrolet Tavera

Chevrolet Tavera Available in: Basic A/c and Heater A/c,Heater and Power steering Triple A/c, Heater, Power steering and Window(9 Seater) Triple A/c, Heater, Power steering and Window(7 Seater) Full Option(7 Seater) Full Option(8 Seater)     NRs 2,520,000

• Chevorlet Optra

Chevorlet Optra Available in: 2.0 Max TCDi 2.0 LS TCDi 2.0 LT TCDi 1.8 LS 1.8 LT NRs 3,520,000

 

Chevrolet promise• Models Maximum Maintenance Cost for 3 yrs

(or 45,000 kms - whichever is earlier from date of vehicle delivery) • Spark Rs. 15,999 • Beat Rs. 16,499 • Aveo U-VA Rs. 16,999 • Aveo Rs. 20,499 • Optra Magnum(Petrol) Rs. 21,999 • Optra Magnum(Diesel) Rs. 32,499 • Cruze Rs. 41,999

In case the cost exceeds this amount, you can claim a full refund of the difference.

Environmental Analysis

• GM and the entire auto industry are currently challenged with the perfect storm. The auto industry is being hit by a weak US and global economy, rising fuel prices, and social and political environmental concerns and issues. In order to overcome these potential threat, GM should consider mass producing a range of alternative fueled vehicles, i.e. fuel cell, electric, and hybrid.

Competitor’s Analysis

• The major competitors of General Motors are domestic companies like Damiler Chrysler & Ford

• Motor and foreign companies like Toyota Motor & Honda Motor

Total motor vehicle production by volume

7234439; 17%

6459053; 15%

6054829; 14%

4685394; 11%

4645776; 11%

3042311; 7%

3012637; 7%

2744562; 6%

2460222; 6%

2387537; 6%

Toyota GM Volkswagen Ford Hyundai Kia PSA Honda Nissan Fiat

SuzukiTo

yota GM

Volkswag

enFo

rd

Hyundai

KiaPSA

HondaNiss

an Fiat

Suzu

ki0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

Series1

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.

2. Global Experience

3. Variety of Brand Names • GM has been the automotive leader for the majority of the last century. • A reason for that is the wide variety of quality brand names that appeal to all target

markets. The current GM brands include: Chevrolet, GMC, Cadillac, Buick, Pontiac, Saturn, Hummer, Saab, Daewoo, Opel, and Holden.

4. GMAC (General Motors Acceptance Corporation) Customer Financing Program • Since its establishment in 1919 it has proven to be GM's most reliable source of

revenue.

5. On Star Satellite Technology • Developed in 1996 On Star currently has over 3 million subscribers and is standard

on all GM vehicles. • This technology allows the vehicles to be tracked in the event of an emergency or

theft. • It also allows the driver and or passengers the ability to communicate with On Star

personnel at the click of a button.

weakness1. Behind on Alternative Energy Movement2. Poor Organizational Structure• GM's organizational structure seems to be

too vertically integrated .• 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. Overly Dependent on US market• GM has become too dependent on the US

market and must take advantage of the opportunity to

expand globally. The competition is becoming too strong to focus on just one country.

4. Overly Dependent on General Motors Acceptance Corporation(GMAC) Financing

• GM has become too dependent on its financing program.

Opportunities1. Alternative Energy Movement• 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. • 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. Develop New Vehicle Styles and Models

• GM should be attempting to develop the automotive world's most popular vehicles.

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. 2. Growth of Competitors 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 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.

4. Increased Health Care Costs GM, like many large companies with quality employee health care benefits, is experiencing a

large financial hit that only gets worse as time continues.5. Rising Supply Costs, i.e. Steel this threat affects the entire automotive industry and forces each company to cut manufacturing

and production costs as much as possible, without taking away from the quality of the product.

Porter’s Five-Forces Analysis• The competitive structure of an industry is

another important component of identifying factors that are a threat to diminish profitability.

• Michael Porter's five-force analysis. (1) rivalry between existing competitors, (2) threat of entry by new competitors, (3) price pressure from substitute or

complementary products, (4) bargaining power of buyers, (5) bargaining power of suppliers

Five forces AnalysisForce Threat to profit

Internal rivalry Strong

Entry Weak

Substitutes and complements Weak to moderate

Buyer power Weak

Supplier power strong

Core Competence

• The core competence of General Motors is innovation. • In 1911, it conceptualized engineered and commercialized

the self-starter engine for the first time. • In 1926, its product Cadillac was the pioneer in devising a

nationwide service strategy.• In 1996 General Motors introduced On Star satellite

technology.• Other new car concepts include mini cars such as Chevy

Aveo.• However in the case of hybrid vehicles, General Motors

was unable to keep up to the pace of the market demand

Financial Results

• Based on the GM’s consolidate net sales and revenue, it shown that General Motor Corporation revenue has been falling to $ 192.6 billion in 2007 from 193.5 billion in 2004. GM incurred a consolidated net loss in 2007 of $ 10.6 billion, compared to net income of $ 2.8 billion in 2004.

• In the last 1990s, GM had regained market share up $ 80 a share.• In 2000, the interest went up by the Federal Reserve to quell the stock

market and a severe stock market decline following the September 11, 2001 attacks. Due to this factor, it affected a pension and benefit crisis at General motors and many other American companies.

• The current stock market price of General Motor sare falling between $28- $29 per share. It has been falling down gradually in the past six years General Motors North America market share in 2007 fell to 25.5% compared to 26.7 in 2004.Decreased in market share also due to sales declines in segment where GM has high volume such as large, sport, utilities, mid-sized, utilities, and mid-sized cars.

Product Mix (General Motors):

Product Item

Product Line

General Motors

Different brands

People in motion

Product

Recognizations•Business Standard Motoring Import Car of the year 2009 •Best SUV(2009)•UV of the year 2009

GM - CSR INITIATIVES

• Be Someone Special. Be a Blood Donor

• Walking for a Cause

Suggested Strategies

1. Market Development2. Market Penetration3. Product Development4. Restructuring5. Retrenchment6. Liquidation

Bibliographic References:

• http://pricenepal.com/22-chevrolet• http://www.google.co.in/#q=advertisement+o

f+general+motors&• http://wikicars.org/en/List_of_Manufacturers• http://carblog.classifieds1000.com/top_auto

makers_for_2009• http://www.chevrolet.co.in/content_data/AP

/IN/en/GBPIN/001/coo-index.html