Abstract
The development of the automotive industry is probably the biggest revolution of the twentieth century along with Internet and telecommunications. Motor cars were invented in 1769 but we had to wait until 1890 to hear about the word "automobile". Since then, many car companies were born; cars and automobiles became the first means of transport in the world and became a way of life. Automobiles, apart from being useful and indispensable as a medium of transport, are also known to be a very common passion. Be it racing, Formula 1, vintage car rallies, cars featuring cutting edge technology, cars are loved by millions of people. The car industry hasn't stopped growing in more than a century. In 2006, one could count almost 600 million cars over the world, almost 1 car for 11 human beings .
But the industry has been facing difficulties since around 2008. Several factors can be pinpointed such as the increase in oil prices, pricing pressures from raw material suppliers, purchasing behavior, etc. The global car market is evolving very fast. In some countries, the market has witnessed a slowdown while in other countries, emerging countries, the market is growing quickly. Logically, the fastest growing markets for car manufacturers are China, Brazil and India, countries in the midst of an exponential economic development. These have recorded the maximum growth during the past five years.
The United States is the world's largest market for light vehicles, cars and light trucks (SUVs and pickups). In 2008, a total of 13.24 million vehicles were sold in the US and we count more than 247 million cars in the US. The industry is dominated by the "Big Three" automobile manufacturers: General Motors, Ford and Daimler-Chrysler. But with the crisis in the industry, GM left lost its number one rank to Japanese manufacturer Toyota. All "big three" are currently facing difficulties but GM has suffered more damage by the crisis; the group is on the verge of bankruptcy.
Through this paper we will analyze the situation of General Motors via a SWOT and PESTL analysis. This analysis will help us understand and relate to the causes of the GM failure, and report the strategic management decisions made by Rick Wagoner to save the company. The last part of the paper isdedicated to the formulation and implementation of strategic management recommendations for GM.
