General Motors Essay

Submitted By kickyou77
Words: 1548
Pages: 7

General Motors Company was founded on September 16th, 1908 by William C. Durant. Durant was previously the owner of a company which led the horse drawn vehicle industry. When General Motors was founded, the headquarters was initially in Flint, Michigan. General Motors was a holdings company which quickly collected more than twenty different motor companies. Companies such as Oldsmobile, Pontiac, Cadillac, Buick, Opel(a German auto company), Chevrolet, and several others. Eighteen years after the founding of the company, December 20th, 1916, it began to publicly trade stocks. Over eight decades, General Motors implemented new ideas which revolutionized the idea of the car, propelling it to quickly become the leaders in innovation. General Motors was the first to create a production car fitted with airbags, and in 1971, it became the first to announce that their cars could run on low-lead or unleaded gasoline, in response to the new eco-friendly movement in that time period. In 1974, General Motors car brands were fitted with catalytic converters, which helped to greatly reduce the emissions from the car, which was again done to help with the quickly polluting atmosphere. However, even with GM’s contribution to the advancement of the auto industry, the company was hungry to expand. Globalization, the act of reaching a worldwide scale, began in 1982 with the opening of an auto complex in Zaragoza, Spain. This auto complex began production of the fuel-efficient Opel Corsa. In addition to the opening of auto complexes in Spain, GM also began to reach for the growing economy countries such as China, which is now the largest auto producer and consumer in the world, as well as India. By 1995, more than 3 million units been sold outside of North America.
The economy took a turn for the worse beginning in 2008, and by 2009 General Motors was not only faced against pressure from competitors, both foreign(Toyota and Nissan) and domestic(Chrysler and Ford), by a crippling economy which destroyed the middle class, and effectively wiped out a large portion of General Motor’s customer base. GM’s stocks dropped below $.75 per share during this time period. On June 2nd 2009, General Motors filed for Chapter 11 bankruptcy, but was soon given government bailout money, “Under conditions that the company further accelerate a tough restructuring of its US operations that had been underway for several years.” With the intervention of the government, the US treasury took 60 %( that number has since been reduced to 20%) of the total shares from GM, which essentially meant that US tax payers held 60% of the stocks of GM.
Today, General Motors has made a substantial recovery from where it was at the height of the rescission in 2009. This calendar year, General Motor’s one year high in the stock market was $30.60, and the one year low was $18.80. At the moment, the current stock price for General Motors is $28.63. Their recovery is due in part because of their tough restructuring carried out by their board of directors, which includes Daniel F. Akerson, the Chief Executive Officer(CEO) and chairman of General Motors, Stephen J. Girsky, the Vice Chairman, David Bonderman, the Co-founding partner and managing general partnerat Texas Pacific Group(a globally recognized investment firm), and Thomas M Shoewe, the former vice president and Chief Financial Officer at Walmart. In addition to members on the board, shareholders, and the executive council also helps to make decisions for the company in order to fulfil the company’s objective to create the most profit. With the decades of success before and after the banking crisis, General Motors was able to create manufacturing factories in numerous locations. There are factories spread all across the globe, in Australia, North America, Asia, Europe, Africa, and South America, where car parts are manufactured to be shipped to the US to be assembled in the dozens of assembly plants spread out across the…