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, GMContinental in Antwerp, Belgium, became the second assemblyoperation. 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 GMtaking 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.

YearTotal GlobalProduction

(thousands)[13]

2007 9,286

2008 8,144

2009 6,503

Rankin

GM

Market/RegionVehicl

esales

Marketshare (%)

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, 2009)

New GM (after July 10, 2009)

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

BrandsVauxhall, GMDaewoo (70.1%), Chevrolet, Cadillac, GMC, Holden, Buick, Opel

5,900U.S. Dealerships

5,000

Common shareholders, bondholders and secured creditors

Ownership

U.S. Treasury, Canada Development Investment Corporation, Government of Ontario, Old GM bondholders, and the United Auto Workers sponsored VEBA

47 U.S. Plants 34

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

91,000U.S. employees

68,500

GM worldwide vehicle sales by country 2008[14]

(thousands)

Rankin

GMCountry

Vehiclesales

Marketshare (%)

1  United States 2,981 22.1%

2  China 1,095 12.0%

3  Brazil 549 19.5%

4  United Kingdom 384 15.4%

5 Canada

359 21.4%

6  Russia 338 11.1%

7  Germany 300 8.8%

8  Mexico 212 19.8%

9  Australia 133 13.1%

10  South Korea 117 9.7%

11  France 114 4.4%

12  Spain 107 7.8%

13  Argentina 95 15.5%

14  Venezuela 91 33.3%

15  Colombia 80 36.3%

16  India 66 3.3%

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 1988China Jinbei GM Automotive Company Ltd 1992China Shanghai GM Corp Ltd 1997China Pan Asia Technical Automotive Centre

Co Ltd1997

Ecuador OBB 1981

Ecuador AYMESA 1982Egypt General Motors Egypt SAE 1983Japan Isuzu Motors Ltd 1971Japan Suzuki Motor Company 1981Japan Fuji Heavy Industries (Subaru) 1999Kenya General Motors Kenya Ltd 1977Russian Federation

AvtoVAZ 2001

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

Global Strategy: A Brand for Every Place

This article explains the international business

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

competitors, G.M. likes having many flagship

manufacturers to allow each demographic of

MarqueYears used

Markets

 Buick since 1908 North America, China, Israel, Taiwan

 Cadillac since 1909Global (except South America, India, SE Asia, Australia)

 GMC since 1912 North America, Middle East

 Chevrole

tsince 1917

Global (except Australia, New Zealand, South Korea, Vietnam)

 Vauxhall since 1925 United Kingdom

 Opel since 1929Europe (except UK), Africa, Asia, Oceania, South America

consumers in each region a proper selection, unlike its American Competitor, Ford, who is

trying to streamline its international lines. It talks about what type of consumer will buy

which type of car they produce. They also state how the types of cars 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 AnalysisStrengths1. Large Market ShareAlthough 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 ExperienceAs 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 NamesGM 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.