General Motors Essay Example | Topics and Well Written Essays - 750 words

General Motors - Essay Example How does the company plan to rally. Are they being realistic in their efforts to meet foreign competition Are they actually looking at the areas that need further attention, or are they looking for short-term incentives as a means of increasing their market share Exactly what are the main issues that must be addressed before GM can begin to recoup its losses In 2005, GM North America reported a loss of $1.6 billion in the third quarter, compared with a loss of $88 million in 2004. In the last quarter of 2005, GM had to revise its losses by a further $2 billion (Krolicki, 2006), the reason said to be charges related to factory job losses and Delphi Corporation's bankruptcy. Unfortunately, the company can be compared at present to a house of cards, easy to topple. Toyota, on the other hand is growing by leaps and bounds and is expected to take over the number one spot in auto sales within the next few years. The chart below is based on an NPR study by Diane Geng (2005) and indicates some of the more telling statistics regarding competition between these companies: Unfortunately, the company does not seem to be focused on global issues, and its efforts have been limited to quick fixes. The recent agreement with United Auto Workers union to cut health care costs, perhaps by $3 billion a year, offers an immediate boost. However, this savings is expected to be achieved by higher co-pay for doctor's visits and prescription drugs. The company also announced its intention to eliminate 25,000 jobs. Where is the incentive for employees to increase output How much emphasis does the company place on employee satisfaction The most recent effort is a promotional incentive for anyone who buys a new SUV in California or Florida. With gas prices at present well over $3 a gallon, the offer for a redeemable card with gas at $1.99 a gallon for one year if the customer signs up for On-Star, free for a year and then $16.95 a month (Durbin, 2006) is an immediate benefit. But will this incentive improve the way customers see the GM brand The major marketing push has been for trucks, especially popular over the past few years, and SUVs. The company's promotional incentive will help sell the SUVs that are no longer as popular as they were, but then what Future Issues to be Addressed at General Motors Because of the present interest in fuel consumption, commentary on the current economy as it relates to automobile design and manufacture is being updated every day. Some of the online publications that offer a running commentary are Business Day, MarketWatch, YEALD and NPR, as well as books and journal articles as noted in references. Certain areas must be explored if GM wants to stay ahead of the market. Because of the serious issues facing the company, a study directed