By Melissa Cox
Your commercial awareness dose,
General Motors, founded in 1908, saw itself as the leading manufacturer throughout the
20th century. It owns and operates a wide range of automobile brands across the globe, such as Chevrolet, GMC, Cadillac, Holden, Isuzu, Opel, Vauxhall, and Wuling. Throughout the 20th century, General Motors experienced blooming periods of success, within different sectors.
General Motors not only manufactured automobiles, engines, and trucks but was able to branch out into aviation as well as locomotives. They managed to spread out internationally before the 1930s, with branches in England and Germany. They also produced a hefty amount of the armaments, aircraft, and trucks throughout WWII. By the 1950s and 60s, General Motors produced 40-45% of all US automotive sales. However, after failing to recollect themselves after 2008, they found themselves filing for bankruptcy in 2009 and in debt by well over $100 million USD.
However, after the automotive crisis of 2008-2010, which resulted in General Motor’s file for bankruptcy in 2009, they have since seen a long period of rock bottom share prices as well as a poor reputation on Wall Street. The emergence of Tesla also posed yet another threat, being seen as trustworthy to investors, as well as three of four electric vehicles being that from Tesla. However, in 2020 throughout the coronavirus pandemic, General Motors has seen an astounding turnaround for the company and its reputation.
Even though General Motors was saved by the Obama Administration with the formation of NGMCO Inc (New GM), and made a recovery, their reputation on Wall Street was pretty
much tarnished. They also found themselves unable to compete with threats like ride-hailing companies such as Uber, Lyft, and by electric vehicle company, Tesla. Not just General Motors, but the automaking industry collectively found themselves in danger due to their poor reputation on Wall Street. COVID-19 posed yet another threat to the automaking industry as lockdowns meant that factories had to close temporarily, and socially distanced workers meant slower production.
General Motors, despite facing challenges related to production and a shortage of parts,
saw an astonishing period of growth during this year’s global pandemic, thanks to sales of Trucks and SUVs. For just the third quarter of the year, General Motors had achieved a $4 billion USD income, a 74% increase from the same time last year. By November, General Motor shares were up by 157% since this March, and their reputation on Wall Street has seemingly made an incredibly positive comeback. General Motors also helped with COVID, by producing 30,000 ventilators and manufacturing 7.4 million items of PPE, such as face masks, face shields, protective gowns, and aerosol boxes.
A few weeks ago, General Motors announced that they will be investing $27 billion USD into electric vehicle development and that they will be unveiling 30 new electric vehicles by 2025, with prices ranging from below $30,000 USD up to around $100,000 USD. They have already revealed two new electric vehicles over the past few months, those being the Cadillac Lyriq SUV (production late 2022) and the GMC Hummer (production late 2021). They also revealed their plans to work on the second generation of their Ultium modular battery system that will allow for a vehicle to cover 450 miles when fully charged, as opposed to the previous 400 miles.
General Motors also stresses the importance of the production of electric vehicles in
relation to climate change. General Motors CEO Mary Barra stated that “Climate change is real, and we want to be part of the solution by putting everyone in an electric vehicle.”
Electric vehicles are also key to aiding their success in China, as there is a high demand
coming from China for electric vehicles due to their strict emission rules. It is also important that they can compete with Tesla, who is seen as a favourite for investors over corporations like General Motors.
There are still those who are unsure of General Motors plans and question whether their
plan to unveil 30 new electric vehicles is a little too ambitious. Their reputation on Wall Street has seen an undeniable improvement, but it is yet to be known whether they can ever catch up to Tesla in the coming years and redeem themselves completely.
To keep up to date with the latest commercial news, click on commercial awareness to get your daily dose.
Donate & Support