A question about GM. Am I off base here?

  • Thread starter Thread starter Oh Brother!
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Oh Brother!

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I see people say that GM built what the public wanted instead of what they needed. I think it boils down to GM chasing the most SHORT TERM profit.
If GM really liked making cars they would be better at it. I think this is why people like the Honda Civic better than the Chevy Cobalt.

GM chased lucrative profits instead of a long term sustainable business model.

Am I right?
What say you?
 
Yes, I think you are right. And that is why GM has not pulled out of the indebtness. The "beast" that is the limo for Obama is made by GM. And GM was favored by Bush.
 
I always wondered why the Oil companies and their 40 Billion dollar yearly profits didn't bail out Ford, GM, and Chrysler....Hell, if it wasn't for the H2s, Expeditions, Commanders and every other gas guzzler, the Exxon wouldn't have half of those profits.

But to answer your question, I believe they went solely for the maximised profits...and meanwhile, Toyota, Honda, and Nissan saw the future and decided to make modest profits, constant improvements, and updated technologies. About a year ago I was at a GMC dealership and the Envoy they showed me had a tape deck! A frickin tape deck!
 
No, you are wrong. Chasing profits is what businesses are supposed to do.

When you go to a restaurant, do you expect to be served what you ask for, or do you let the waiter decide what you need?

A successful corporation is one that supplies its customer's current needs, while either anticipating what they will want, or being flexible enough to retool quickly.
 
Pretty much correct. The profit margin on an SUV is very high, a small car is much less profitable. Some small cars, such as the Dodge Neon, are only made for the purpose of meeting minimum MPG average standards, for every small car like this, they can sell a giant SUV and their only goal on the small car is to break even on it. Short term gains are huge and executives get paid bonuses right away - and they get to keep their bonuses when the company goes into bankruptcy a few years down the road.

There's also the reliability issue of simply choosing to make cars that fall apart at around 100 - 150K miles because they assume people will just go out and buy another one. It worked for a while but most people are starting to realize that Hondas, Toyotas, BMW's etc. are much more reliable in the long term.
 
GM also allowed the UAW Union to dictate the direction if the corporation. They caved to Union pressure and now they're paying the price. Because of the Union contracts they signed, GM had limited resources to design and manufacture a higher quality car. The Unions screwed GM and now it's the Unions that are going to get screwed by their own actions.

The only good Union is a busted Union.
 
I say, old chap, that we are in a world wide recession with massive unemployment and all the car companies are building what the public cannot afford. Toyota and Nissan are having gigantic losses and being bailed out by their government also.
 
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