General Motors was founded in 1908 and was once the industry leader, but lost market share to Japanese manufacturers in the 1970s. It filed for bankruptcy in 2009 after receiving government loans. The document compares GM's financial metrics to its main competitors Ford and Toyota, showing that GM has lower return on equity, current ratio, gross profit margin, and asset turnover, indicating weaker financial performance. It poses three questions about whether one would invest in, lend to, or work for GM based on this financial data and the company's history of losses and bankruptcy.
2. Brief History
• Founded in 1908
• Industry leader in 1927
• Owned Pontiac, Cadillac, GMC, Chevrolet…
• Lost market to Japanese manufacturers in late
1970s
• Got billions of dollars in loan from
government
• Went bankrupt in 2009
3. Competitors
• Three main competitors
Ford
Chrysler
Toyota
GM Ford Toyota
Industry
Median
ROE (35.8%) N/A (4.0%) (0.6%)
Current Ratio 0.51 2.2 1.07 1.32
Gross Profit
Margin
-14% 15.01% 10.10% 15.99%
Asset
turnover
1.24 0.5 0.7 0.6
-40.00%
-30.00%
-20.00%
-10.00%
0.00%
ROE
ROE
0
0.5
1
1.5
2
2.5
GM Ford Toyota Industry
Median
Current Ratio
Current Ratio
0
0.2
0.4
0.6
0.8
1
1.2
1.4
GM Ford Toyota Industry
Median
Asset turnover
Asset turnover
-15%
-10%
-5%
0%
5%
10%
15%
20%
Gross Profit Margin
Gross Profit Margin
