General Motors has made a full recovery, more or less, from the unprecedented crisis which almost brought about the complete collapse of America's biggest car company in 2009. Until recently, the group was the undisputed global leader in the automobile market, with an extensive portfolio housing eight of America's most celebrated automobile marques as well as a large international footprint. As recently as 1980 almost one out of every two new cars sold in America were made by General Motors, and it enjoyed a similarly dominant position in other countries as well. Yet in the harsh automotive environment of the 21st century, GM struggled to maintain its lead in the face of brutal competition, especially in the US, from manufacturers offering more flexible, less gas-hungry cars. A catastrophic fall in sales across the whole market during 2008 left the group poised on the brink of bankruptcy and it was overtaken for the first time in its history as the global #1 by rival Toyota. The following year, GM finally accepted defeat and filed for Chapter 11 protection. A new and much smaller GM emerged from bankruptcy having shed the bulk of its huge debt burden as well as half of its car brands. Its main surviving brands are Chevrolet, Cadillac, Buick and GMC. Only one major problem remained: its long-struggling business in Europe. It finally found a solution to that dilemma too in 2017 with a deal to sell Opel and Vauxhall outright to French manufacturer PSA. It will also withdraw from India and South Africa.
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Adbrands Weekly Update 29th Nov 2018: General Motors is to scale back production, mainly in North America but also internationally, to "right-size" its operations for the changing auto environment. It aims to cut around $6bn of costs in anticipation of further fallout from Trump's tariff war as well as the sharp slowdown in sales of traditional passenger cars in favour of SUVs and light trucks. Around 15% of salaried workers in the US will be laid off during next year and production will idle or cease at five factories in the US and Canada, and two overseas. Several current models will be dropped. Volumes for the year to-date of the Chevrolet Camaro, Corvette, Cruze, Malibu and Sonic are all down by at least 20%, offsetting equally strong increases at the Colorado, Spark and Traverse. At the same time, GM plans to double its investment in electric and self-driving vehicles. "We're taking these actions while the company and economy are strong to stay ahead of what we all know are very challenging environments," said GM CEO Mary Barra. "This is about making sure GM is lean and agile to get in front and lead in autonomous and electric vehicles." The news didn't please President Trump, who summoned Barra in to see him and chief economic advisor Larry Kudlow. "The US saved General Motors," Trump tweeted in a reference to the 2008 bailout, "and this is the THANKS we get! We are now looking at cutting all GM subsidies, including for electric cars."
Adbrands Weekly Update 1st Nov 2018: General Motors surprised almost everyone with a 25% jump in operating profits for 3Q, on revenues up 6% - also higher than expected - to almost $36bn. Despite a slowdown in what is now its biggest market, China, GM reported its best-ever profits there, while bottom line in the US was also boosted by strong sales of more expensive trucks and SUVs and fewer promotional discounts. That lifted margins even as volume sales in both countries cooled in the wake of the trade war between the US and China over steel and other commodities. Keen to maintain its high profit margins ahead of a possible economic downturn, CEO Mary Barra also announced an offer of voluntary redundancy to around 18,000 workers in North America.
Adbrands Weekly Update 4th Oct 2018: Honda is joining Japanese investor Softbank as a key supporter of GM Cruise, the self-driving technology being developed by General Motors. Honda will acquire will invest $2.75bn in the project, in return for a 6% stake. $750m is being paid now, with the rest in stages over the next decade. Softbank pledged $2.25bn earlier this year, for a near-20% stake in the venture. GM Cruise is being established as a separate standalone business in order to attract technology investors who are wary of the traditional automobile industry.
Adbrands Weekly Update 7th Jun 2018: General Motors received a resounding endorsement of its self-driving GM Cruise technology in the form of a $2.25bn investment by Japanese investment and telecoms company Softbank, best-known in the US as the current owner of mobile service Sprint. Only $900m is being paid over at this point; with the balance to be invested once GM's self-driving cars are ready to be launched commercially. Softbank will end up with a 20% stake in GM Cruise.
Adbrands Weekly Update 5th Apr 2018: Ads of the Week: "Horn". GM has launched a big new push for OnStar, its proprietary in-car connectivity platform, through longtime agency Campbell Ewald. Though originally conceived as a navigation and safety service, OnStar's focus gradually shifted in the early 2010s towards other areas, such as in-car entertainment and wifi connectivity. However, the rising US auto accident rate has encouraged GM to renew its emphasis on that original brief. As this highly effective, beautifully shot new campaign illustrates, OnStar's live human operators can offer drivers much needed comfort and support in times of emergency. That's one major USP all by itself.
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Free for all users | see full profile for current activities: The bankruptcy of General Motors in 2009 brought to a close just over 100 years of prominence as an icon of American business. Indeed, at its peak in the post-war period, the company was in effect a symbol of America itself, a leader in technology, design, innovation and consumer choice. As GM's president in the early 1950s, Charles E Wilson, was reported to have said: "What's good for General Motors is good for the country". Yet by the 1990s, and even occasionally in the two decades before then, the company had increasingly became an emblem of everything that was wrong about the country. Inflexible, tied to inflated ideas of its past glory, unwilling to accept new ideas, and unable to integrate its multiple competing brands.
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