6. The turnaround post the bankruptcy and suggestions
General motors had faced the issue in 2008 because of the downturn in its sale and went on for bankruptcy. Company had made turnaround since then and within five years of huge equity infusion by the US government, company had come out of crisis. In 2009, company was on the verge of being liquidated and was set to be closed. But it made a turnaround by restructuring itself. At that time, there also a fear that no one would like to buy a car from a company which has been bankrupt. Company’s reputation had gone for a toss. Company had been PR problem. Company’s sales were already going down and with the news of its bankruptcy, company faced a further downturn in its sales.
General motors received …show more content…
Company decided to innovate and have a creativity in its design and decided to sell those innovative where it has been making profits and hence target marketing in specific countries became the objective of the company. Company also decided to leave the countries where it was not making profits and was not able to be a significant automobile force in the country. General motors decided to make products which meet the requirement of each market rather than selling a single model across the world. This helped in making the brand stronger. Company launched multiple models in the market to attract the customers. Chevrolet Volt, Cadillac CTS Sportswagon, Chevrolet Camaro, Cadillac SRX were launched right after the bankruptcy and were very successful in generating profit for the …show more content…
And a declining revenue was not able to match the constant cost structure of the company. It made the company go into red and hence file a bankruptcy. Toyota, its main rival had been able to maintain a double digit gross margin while General Motors was not able to do so and hence faced a major setback. Company decided to reduce the no of manufacturing sites and to have less powertrain and assembly lines. This helped the company increase its productivity. Company also decided to reduce its fixed and hence the operating leverage to sustain in the environment of reducing sales and hence make the profitable in downturn and be ready for the future when its sales grow. Company also had high manufacturing hours per vehicle in 2008, company decided to reduce the no. of hours and brought to the level of Toyota. This helped the company in reducing its working capital requirement and hence make the company leaner. This also helped in reducing the labor cost per vehicle and hence bringing down the cost for the company. Company also reduced its salaried employee to reduce its fixed cost and make company ready in the period of a
General motors had faced the issue in 2008 because of the downturn in its sale and went on for bankruptcy. Company had made turnaround since then and within five years of huge equity infusion by the US government, company had come out of crisis. In 2009, company was on the verge of being liquidated and was set to be closed. But it made a turnaround by restructuring itself. At that time, there also a fear that no one would like to buy a car from a company which has been bankrupt. Company’s reputation had gone for a toss. Company had been PR problem. Company’s sales were already going down and with the news of its bankruptcy, company faced a further downturn in its sales.
General motors received …show more content…
Company decided to innovate and have a creativity in its design and decided to sell those innovative where it has been making profits and hence target marketing in specific countries became the objective of the company. Company also decided to leave the countries where it was not making profits and was not able to be a significant automobile force in the country. General motors decided to make products which meet the requirement of each market rather than selling a single model across the world. This helped in making the brand stronger. Company launched multiple models in the market to attract the customers. Chevrolet Volt, Cadillac CTS Sportswagon, Chevrolet Camaro, Cadillac SRX were launched right after the bankruptcy and were very successful in generating profit for the …show more content…
And a declining revenue was not able to match the constant cost structure of the company. It made the company go into red and hence file a bankruptcy. Toyota, its main rival had been able to maintain a double digit gross margin while General Motors was not able to do so and hence faced a major setback. Company decided to reduce the no of manufacturing sites and to have less powertrain and assembly lines. This helped the company increase its productivity. Company also decided to reduce its fixed and hence the operating leverage to sustain in the environment of reducing sales and hence make the profitable in downturn and be ready for the future when its sales grow. Company also had high manufacturing hours per vehicle in 2008, company decided to reduce the no. of hours and brought to the level of Toyota. This helped the company in reducing its working capital requirement and hence make the company leaner. This also helped in reducing the labor cost per vehicle and hence bringing down the cost for the company. Company also reduced its salaried employee to reduce its fixed cost and make company ready in the period of a