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Macroeconomic Forecast
Organization Overview (Automotive)
General Motors Corporation (GM) headquartered in Detroit, is the largest automaker in the world. GM was founded in 1908 and today it employs over 300,000 people worldwide. GM operates globally and has manufacturing related operations in over 30 countries. GM sells nearly 9 million vehicles in over 200 countries. Automotive Industry in general is re-inventing itself by introducing more fuel-efficient cars due to the global increase in gas prices. Along with the high cost structure GM is also facing Operational issues such as their dependence on vehicles designed for developed markets and add to the mix planning issues related to the speed of change that has accelerated dramatically and the fact that current models are having a shorter shelf life than in the past. According to (Korth, 2005) "The ability to turn around these negative trends is in question and the scale of improvement required in the short term is daunting."
Recent numbers provided by key economic indicators such as Retail Sales, GDP, Unemployment Rates and Interest Rates do not bode well for General Motors. "Retail new-vehicle sales in the first nine days of October were down 33 percent versus the same period a year ago, and down 44 percent versus the first nine days of September, according to the Power Information Network, the industry's premier source for real-time automotive monthly retail sales data." (Retail New-Vehicle Sales Drop, 2005) Given the current quagmire, GM faces several operations and planning related issues. First, cost-issues with suppliers; GM will be giving suppliers cost-cutting targets for parts based on ...