General Motors
...of thousands of employees. By changing management, closing plants, laying off of workers, lowering the profit margins of suppliers, and cutting back on fleet discounts and sales deals. General Motors returned to profitability in 1993. Thru out General Motors history, the company always find a way to rebound back into competition. The list of projects for General Motors goes on such as, 1996 GM introduced the EV1, an emission-free, two-seat electric car powered by rechargeable lead-acid batteries, new joint venture assembly plant in Shanghai, China, acquire exclusive rights to the Hummer automotive brand from AM General Corporation and also enters into electronic business partnerships with Sony, Net Zero, and America Online and the list goes on. Mergers And Acquisitions Throughout General Motor’s history, the company has mergers and acquisitions with many companies. Like I stated before, Generals motors founder William Durant believed that any car manufacturer producing only one model line was vulnerable to bankruptcy if sales faltered for even a single year. A large company that produced a variety of models, he reasoned, would be better protected from market forces. Olds Motor Vehicle Company, founded by Ransom E. Olds, the oldest unit of General Motors. Oldsmobile made their first American car in 1901 and the second unit of the General Motors (GM 1900s 9). General Motors purchases a half interest in Oakland Motor Car Company on January 20, 1909. When its founder, Edward Murphy, passes away the following summer, his company came under the full control of General Motors. In 1932, the Oakland name is dropped from the vehicle line and Pontiac becomes the name of the division. General Motors bought Cadillac (then owned by Ford Motor Company) in 1909 for about $9.5 million (GM 1900s 17). Chevrolet Motor Company of Michigan, founded in November of 1911 by Louis Chevrolet, William Little and Edwin Cambell, William Durant's son-in-law (GM 1910s 6). In 1911, United Motors Corporation becomes part of General Motors Corporation. United Motors Corporation is dissolved in 1919 and individual businesses continue as part of General Motors (GM 1910s 10). United Motors Service, created by Sloan in 1916 to handle sales for the United Motors Corporation manufacturing divisions, is included in this acquisition and becomes a division of General Motors in 1944. In 1971 United Motors Service Division is renamed United Delco Division and in 1974 it is absorbed into AC-Delco Division (GM 1910s 20). In 1923, General Motors acquires all outstanding stocks of Brown-Lipe-Chapin Company of Syracuse, NY, a manufacturer of automobile differentials and gears. Executives become stockholders under a plan allowing them to acquire stock through the Managers Securities Company. This is the most far-reaching effort yet made by a large corporation to align interests of management and stockholders through having leaders become large stockholders themselves (GM 1920s 13). In 1925, General Motors bought out the Bus companyYellow Coach, helped create Geyhood bus lines, replaced intercity train transport withbuses , and established subsidiary companies to buy out street cars companies and replace the street cars by buses (GM 1920s 18). In 1929, General Motors acquired Opel AG, based in Rüsselsheim, Germany (GM 1920s 45). Also in 1929, General Motors enters the commercial aviation business by buying a 40 percent interest in Fokker Aircraft Corporation, which now has assets of Dayton-Wright, 24 percent interest in Bendix Aviation Corporation, and all of the outstanding stock of Allison Engineering Company. These acquisitions also give General Motors access to technical information that is valuable in automotive operations. The name of Fokker Aircraft Corporation of America is changed to General Aviation Corporation (GM 1920s 47). In 1930, General Motors bought the internal combution engined railcar builder Electro-Motive Corporation and its engine supplier Winton Engine, renaming both as the General Motors Electro-Motive Division (GM 1930s 1). In 1931, General Motors – Holden’s Ltd. is formed through merger of Holden’s Motor Body Builders Ltd. and General Motors (Australia) Pty. Ltd (GM 1930s 3). In 1943, General Motors acquires all assets of Yellow Truck & Coach, and the General Motors Corporation Truck & Coach Division is formed (GM 1940s 7). In 1971, General Motors and Isuzu Motors Limited sign an agreement under which General Motors acquires 34.2 percent interest in Isuzu. Initial plans are for General Motors to market and service Isuzu trucks (GM 1970s 6). Also in 1971, General Motors acquires all shares of Capital Motors Assembly Corporation in Tampoia, Malaysia, and forms General Motors Malaysia BHD. General Motors Malaysia BHD is sold to Oriental Holdings BHD of Malaysia in 1980 (GM 1970s 9). In 1972, General Motors enters into an agreement to form a joint venture company with Iran, Shinjin Motor Co. of Seoul, Korea, and the Philippine. This joint venture allows General Motors to produce and distributed parts and cars in these countries (GM 1970s 12). In 1981, General Motors enters a joint venture in Taiwan to build heavy duty trucks, buses and diesel engines when it purchases a 45 percent holding in Hua Tung Automotive Corporation (GM 1980s 2). In 1982, General Motors withdraws from the joint venture and sells its 45 percent equity interest. In 1989, General Motors establishes General Motors Taiwan, Ltd., a wholly-owned subsidiary, to import and distribute North American and Saturn vehicles, and to import, assemble and distribute Opel vehicles. In 1984, GM acquires Electronic Data Systems Corporation, one of the leading data processing and telecommunications companies in the world (GM 1980s 33). In 1985,General Motors acquires Hughes Aircraft Company, regarded as one of the leading defense electronics firms in the world. It is to remain independently managed as a subsidiary of General Motors Hughes Electronics Corporation, a new wholly owned subsidiary of General Motors. Delco Electronics Corporation becomes a subsidiary of General Motors Hughes Electronics Corporation (GM 1980s 38). In1986, General Motors acquires Group Lotus, the U.K.- based engineering consulting and performance car manufacturing firm. In 1993, General Motors sells Group Lotus and Lotus Cars USA to Bugatti International SAH of Italy (GM 1980s 40). In 1986, General Motors and Volvo form a joint venture in the U.S. to develop, produce, and market heavy-duty trucks for North America. Volvo is given operational responsibility for the Volvo General Motors Heavy Truck Corporation (GM 1980s 44). Also in 1986, General Motors of Canada and Suzuki announce a joint venture; manufacture small cars and sport utility vehicles in Canada (GM 1980s 41). In 1988, General Motors and Toyota establish joint venture in Australia to coordinate design, engineering and product sharing strategies. It is to include assets from General Motors Holden’s Motor Co. and Toyota’s Australian operations. The joint venture, United Australian Automotive Industries was dissolved in 1996 (Hoover GM). In 1989, General Motors establishes General Motors Taiwan, Ltd., a wholly owned subsidiary, to import and distribute North American and Saturn vehicles, and to import, assemble and distribute Opel vehicles (GM 1980s 78). In 1989, General Motors purchases 50 percent of Saab Automobile AB of Sweden to develop, manufacture and market Saab passenger cars worldwide (GM 1980s 77). In 1990, in Hungary, General Motors forms a joint venture with RABA, the state-owned producer of trucks, axles and diesel engines, to build engines and assemble cars beginning in 1992. Packard Electric Europe forms a joint venture with Villszov, a Hungarian firm, to manufacture automotive power and signal distribution systems primarily for export for Opel cars produced and sold in Western Europe. In 1999, General Motors acquires Bank of New York Financial Corporation, the asset-based commercial lending and factoring business of Bank of New York (GM 1990s 65). Also in 1999, General Motors acquire exclusive rights to the Hummer automotive brand from AM General Corporation (GM 1990s 67). In 2000, General Motors and Fiat create a strategic alliance, with General Motors holding 20 percent equity in Fiat and the two companies creating several joint ventures to share power trains and components (GM 2000 5). Generals Motors vision to deliver quality product and service for consumers and communities through leadership, innovation, and partnership. With this vision of being the quality leader in everything they do, General Motors mergers and acquisitions lead them to become one of the largest corporation in the world. Competition General Motors by being the largest car company in the world has many competitors. The company’s main competitors in cars and trucks in the United States and Canada are the Ford Motor Company, Daimler Chrysler Corporation, Toyota Corporation, Nissan Motor Corporation, Ltd., Honda Motor Company, Ltd., Mazda Motor Corporation, Mitsubishi Motors Corporation, Volkswagen A.G., Hyundai Motor Company, Ltd., Bayerische Motoren Werke AG (BMW), Volvo AB, and Kia Motors Corporation (Hoover GM). Foreign Interests General Motors foreign interests reaches across the world. You can say, there are just a few foreign countries that General Motors does not have interests in. Just to name a few, Germany, Japan, Italy, Korea, South Africa, and Russia. Germany, Generals Motors have an interest Opel. Opels includes Corsa, Astra, Vectra, and Omega (Wikipedia Opel). Japan, Isuzu, a Japanese car company (Wikipedia Isuzu). Subaru, a Japanese car company which General Motors is 20 percent minority shareholder (Wikipedia Subaru). Suzuki, a Japanese car company (Wikipedia Suzuki). Italy, Fiat, Italian car company based in Turine, northern Italy (Wikipedia Fiat). Alfa Romeo, Italian car company, founded in 1910 in Milan, Italy (Wikipedia Alfa Romeo). Lancia, founded in 1906, part of the Fiat group since 1969 (Wikipedia Lancia). South Korea, Daewoo, South Korean car company was founded in 1967 as Daewoo Industrial (Wikipedia Daewoo). South Africa, Delta, South Afican car company, which was created through a management buy-out after Generals Motors divested from South Africa in 1986 (Wikipedia Delta). General Motor’s foreign interests generate sales in foreign markets that generally could not be achieved by producing goods entirely at home and exporting them. The strategy used by General Motors multinationals of using foreign affiliates in coordination with domestic operations to produce goods allows General Motors multinationals to compete effectively around the world while still generating significant exports. General Motor’s foreign interest is not limited to cars and trucks. General Motors have foreign interest in research and technology labs around the world. Future Expectations General Motors is not only the world’s largest manufacturer of automobiles and one of the world’s largest manufacturers of trucks, it is also is one of the world’s largest financial services companies. General Motor’s future expectation I believe is leaning more to their financial operations. General Motors by being one of the world’s largest financial services companies with assets at nearly $300 billion and operations in some offices in 41 countries (Wall Street Journal, GM). Generals Motors can offer financing to car dealers and customers. General Motors also offers insurance services in maintenance contracts and commercial and personal auto insurance. General Motors mortgage services single family and commercial estate loans, invests in mortgage-backed securities, and packages nonconforming single family home loans for sale to investors. General Motors also owns ditech.com, an online mortgage lender. General Motors has always made its priority to stay a step ahead of their competition. By staying one-step ahead of their competition and having developed a trustworthy relationship with their consumers, which is vital towards their success the future. Why I Would Buy The Stocks Of General Motors Yes, I would buy stock in General Motors. I would invest in General Motors for a long-term investment. General Motors sells about one-third of all cars and trucks in the United States and about one-sixth of all car...