Gm Case Study

2. Discuss the latest state of the new (smaller) GM

Background

After emerging from bankruptcy, the new GM was in reality a nationalized, government-owned automotive enterprise. It was referred as government motor by some in the US. Whereby Obama Administration’s economic policy the American taxpayer owned the majority of GM. The process of reorganization was completed on 10 July 2009 after emerging from bankruptcy. The old GM transferred its good assets into a new, US government-owned company named General Motors Company. Next I will analysis the process of reorganization through 4 parts.

Process of reorganization

- product portfolio and brand focus

First company changed its name to General Motors Company. Second the company reorganized the content and structure of its brand portfolio and downsized through the sale or closing of some brands including Saturn, Hummer, and Pontiac (Elliott, 2009). In 2011, GM discontinued the Daewoo brand in South Korea and replaced it with the Chevrolet brand (Bernama, 2011). And its focus on two brands, they are Chevrolet, which embodies the qualities of value, reliability, performance and expressive design; and Cadillac, which creates luxury vehicles, which are provocative and powerful. At the same time, the Holden, Buick, GMC, Baojun, Opel and Vauxhall brands are being carefully cultivated to satisfy as many customers as possible in select regions (Akerson, 2012).

- supply chain

The sales network was slimmed down by closing down thousands of dealerships. In the process of re-emergence, the old GM transferred its good assets into new company.

- cost structure

The new company reduce costs first rewrite its labor contracts to slash costs. For example decrease the package of benefits, reduce employee’s pension and medical costs. It also shed tens of thousands of workers, closing scores of factories. It can be helpful to the increase of production costs. For new GM it needs to emphasis R&D. Its universal reorganization plan was confirmed by the Department of automobile fuel economy, hybrid and advanced propulsion systems leading evolutionary, and under