| Name | General Motors Company |
| Industry | Automotive |
| Founded | 1908 |
| Headquarters | Detroit, Michigan, United States |
| CEO | Mary T. Barra |
| Revenues | USD 34.17 Billion, 2021 |
| Profit | USD 2.79 Billion, 2021 |
| Competitors | Ford, Hyundai, Volkswagen, Toyota, Nissan |
Headquartered in Michigan, United States, General Motors was established by Frederic L. Smith, Charles Stewart Mott, and William C. Durant in 1908. General Motors is a leading US-based multinational automotive manufacturing company, providing a variety of vehicles to customers worldwide. Currently, it has more than 396 facilities in six continents, operating with the support of 155,000 employees (General Motors, 2021). It mainly offers the manufacturing, designing, and selling of trucks, cars, and automobile parts. It has a market capitalization of $84.66 billion, making it one of the top automotive companies all across the world (Forbes, 2021). Let’s now go over the SWOT Analysis of the company.
Table of Contents
General Motors Strengths 2021:
- Global Presence.
General Motors is a global brand with a strong market presence in the international automobile market. It also holds a strong global sales and distribution network of sales, including the US, China, and other regions. It has currently a wide network of 12,358 dealerships, which are authorized along with 5,694 suppliers in the United States (General Motors, 2021). - Diverse Brand and Product Portfolio
One of the major strengths of the company is its large product portfolio. The portfolio of General Motors includes a wide range of brands, including Cadillac, Chevrolet, GMC, and Buick. They all operate under the parent company General Motors, which gives it a strong competitive edge all across the world. Moreover, it has a diverse product portfolio, such as pickup trucks, SUVs, and others to cater to the demand of all segments of the customers. - Strong Brand Value.
General Motors has a strong brand value in the market, being the global producer of automobiles. Brand equity and popularity rely on a variety of factors in an automobile industry, such as technological innovation, customer experience, product quality, and so on.General Motors have focused on all these areas through heavy research and development along with the marketing of their products. According to Forbes (2021), it has ranked 47 in the Global 2000 companies in 2021 with a market capitalization of $85.6 billion, showing a leading automotive company all across the world. - Market Leader.
In the United States, General Motors is considered one of the top three brands, with a market share of 17.3% in 2020 (Carlier, 2021). This reflects the dominancy of General Motors in the US market along with Ford and Toyota, which are also global automobile brands.
General Motors Weaknesses 2021:
- Highly Dependent on US Market.
General Motors is a well-known global automaker that relies heavily on sales in the United States, particularly in North America. Its business operations are divided into two main segments: GM International and GM North America. According to General Motors (2020), GMNA generates 89 percent of total revenue in 2020, while GMI generates just 10%, indicating that the firm is largely reliant on the US market, particularly in North America. - Products Recall.
In the automobile industry, product recalling creates a bad repute for the brand and also increases the costs for the company. At the end of 2020, the company was forced to recall around 7 million SUVs and big pickup trucks for replacing the Takata airbag inflators. Although it created huge costs for the company, it was necessary to ensure the security of the passenger. But GM faced criticism from its customers. - Over-Reliance on the success of pickup trucks and SUVs.
General Motors currently relies mainly on the sales of SUVs and pickup trucks, which limits their product portfolio. In 2019, GM observed a 2.9% decrease in the sales of cars, owing to the decline in the demand for pickup trucks and SUVs by 2% overall in the market (Wayland, 2020). This shows that GM is highly sensitive to the market demand of only these two products.
General Motors Opportunities 2021:
- Emerging Technologies and Autonomous Driving.
Driverless cars have become a major focus of the automobile business all across the world. The technology behind autonomous driving can result in higher growth of the automobile business, with respect to expansion and sales. In order to see the emerging trends, General Motors have founded a separate department with the name of Cruise for the development and commercialization of autonomous driving technology, which will work on the AI and digitalisation of this technology in GM. - Developing Automobile Market.
Owing to COVID-19, the automobile industry noted a significant plunge in sales, as 47% of sales dropped in the US and 71% in China (Hensley, et al., 2021). But, as life is coming back to pre-Covid, the world has observed a significant increase in automobiles, especially in car and truck categories. Therefore, General Motors also reported a 4.8% increase in US sales in the fourth quarter of 2020 (General Motors, 2020), which can go further up in the current year due to the growing automobile market.
General Motors Threats 2021:
- Intense Competition.
The automobile industry faces intense competition in global markets. From giant Volkswagen to luxurious BMW, formal Mercedes, relentless Toyota, and stylist electric cars Tesla, the automobile industry is not easy. Some huge giants are working for many decades and striving hard to increase their market shares. Therefore, GM may face difficulty to retain its position and gain more market share. - Negative Impacts of Trade Wars Between the US and China.
Currently, the US and China are having trade wars, which have greatly affected their businesses (Huang, 2021). In the case of GM, whose major auto parts come from China, will have difficulty to produce their products, if the wars get intense and lead to the ban of import-export between them.
General Motors SWOT Analysis Conclusion:
In conclusion, General Motors is a leading automobile brand working globally, operating through a variety of reputed brands. It has a strong global presence due to a wide network of authorized dealerships and holds good brand repute due to its high quality. While due to product recalling and over-reliance on the US sales may become GM bit weak than its competitors. But due to its huge investment in research and development of AI technology and autonomous driving, GM may be able to increase its market share among the highly competitive markets.
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References:
- Carlier, M., 2021. General Motors’ vehicle sales market share in the U.S. 2015-2020. Statista.com.
- Forbes, 2021. General Motors (GM).
- General Motors, 2020. Annual Report 2020, s.l.: General Motors Inc.
- General Motors, 2021. GM in the U.S.
- Hensley, R., Maurer, I. & Padhi, A., 2021. How the automotive industry is accelerating out of the turn. Mckinsey.com.
- Huang, Y., 2021. The U.S.-China Trade War Has Become a Cold War. Carnegieendowment.org.
- Wayland, M., 2020. GM’s 2019 sales decline after discontinuing some models and demand falls for trucks, SUVs. CNBC.com
