General Motors Company, aka GM,
founded in 16 September 1908, is
an American multinational
corporation headquartered in
Detroit, Michigan that designs,
manufactures, markets and
General Motors produces vehicles
in 37 countries under ten brands:
Chevrolet, Buick, GMC, Cadillac,
Opel, Holden, Vauxhall, Wuling,
Baojun, Jie Fang, UzDaewoo.
20% stake in IMM, and a 96% stake in GM Korea. It also has a
number of joint-ventures, including Shanghai GM, FAW-GM in
China, Ghandhara Industries in Pakistan, GM Uzbekistan, General
Motors India, General Motors Egypt.
General Motors employs 212,000 people and does business in 157
General Motors is divided into five business segments
General Motors acts in most countries outside the U.S. via wholly
owned subsidiaries, but operates in China through 10 joint ventures.
From 1931 through 2007, General Motors led global vehicle sales for
77 consecutive years.
In 2008, 2009, and 2010, GM has ranked as the second largest global
automaker by sales.
In 2009, General Motors shed several brands, closing Saturn, Pontiac
and Hummer, and emerged from a government based reorganisation.
In 2010, GM made an initial public offering that was one of the world's
top 5 largest IPOs to date.
The company regained its position as the world's largest automaker, by
vehicle unit sales, in 2011.
Until 2008, when it was overtaken by Toyota, GM was the
world's biggest carmaker, producing well over 9m cars and
trucks a year in 34 different countries. It has 463 subsidiaries
and employs 234,500 people, 91,000 of them in America,
where it also provides health-care and pension benefits for
493,000 retired workers. In America alone, it spends $50
billion a year buying parts and services from a network of
11,500 vendors and pays $476m in salaries each month.
Information about the unethical practises
conducted by the Company
• Bad financial policies
• Uncompetitive vehicles
• Ignoring competition
• Failure to innovate
• Managing in the bubble
• Corporate governance issues take on a
different complexion when failures result in
harm to innocent consumers. Companies
recognize this and have to make sure their
controls and procedures are designed to
match those risks.
Person behind the downfall
- A brief review of the person
George Richard “Rick” Wagoner, Jr.
George Richard "Rick" Wagoner, Jr. (born February 9, 1953) is an
American businessman and former Chairman and Chief Executive Officer of
Wagoner became president and CEO in June 2000 and was elected
chairman on May 1 2003. Under his leadership GM suffered more than $85
billion in losses
He resigned as chairman and CEO at GM on March 29 2009, at the
request of white house.
This led to his being named as the worst CEO of 2008.
• Wagoner resigned as part of Obama
administration deal to provide GM with further
short term financing
• The initial restructuring plan got rejected
• US Govt. set deadline of 60 days to come with
new proposal or forced into bankruptacy
• Wagoner was repaced by Fritz Henderson
• The question is whether the new, smaller GM can succeed on its own more modest
terms. Without doubt, its structural costs will be much lower: $23.2 billion in 2010,
against $30.8 billion in 2008.
• With fewer brands and dealers it will be able to focus marketing and advertising
• GM also retains the design and engineering resources to develop competitive cars,
thus restructuring business as a whole.
• Obama and Bush together made short term political sacrifices to save the economy,
and followed economist's advice to pass $814 billion stimulus package
• saved 1.14 million jobs
• Opted treasury sale of shares as it would minimise pressure on stock prices
• The car-industry task-force appointed by Barack Obama to save GM and
Chrysler quickly concluded that neither could be viable without the
pressure of bankruptcy to force stakeholders to renounce most of their
• Although GM's bankruptcy will be more complicated and drawn out, a new
entity should emerge before September. The government, which is putting
$30 billion into GM on top of the $20 billion it has already handed over,
will receive 60.8% of the stock. The Canadian government, which is
providing $9.5 billion, will get 11.7%. The UAW's trust will have 17.5%
and the bondholders 10%. Despite the size of its stake, the government is
adamant that it is a reluctant shareholder and will stay out of managing the
business. It hopes that within 18 months GM might become a publicly
traded company again.