A SWOT analysis of General Motors (2017)

General Motors is a customer focused company. Since its government  bailout during the recession, it has focused on innovation and customer orientation. From safety features and innovative driving arrangements, the brand has focused on producing cars that fit into its customers’ lives.  Now, customers are at the center of its focus and it is doing everything with their needs in mind. Apart from making new electric vehicles, it has made its cars better in terms of technology and comfort.

GM remains with only four of its brands. They are Chevrolet, Cadillac, GMC and Buick. Saab was sold, Saturn and Hummer had to be discontinued. However, military style Hummer is returning, thanks to the falling oil prices. Saturn and Saab too might make a return. Now, the days of economic difficulties are long past and the financial performance of GM has improved and sustained over the past several years.   In 2015, its focus was mainly on managing the ignition switch fiasco. However the recalls, it seems will continue to trouble GM. Still, based on the complexity of automotive business, such anomalies are rarer for GM than other car producers.

The company has made passenger safety and comfort an important goal. In 2015, its performance in the core North American market grew better creating a profit of $9.7 billion. While most analysts believe that car sales in US may have peaked, GM is still hopeful and expects the US market to grow further.   Its strong profits have helped it invest in Electrical Vehicles and other new technologies including automated driving. Here is a SWOT analysis providing a detailed overview of GM’s overall position and performance.

GM SWOT Analysis
SWOT Analysis of General Motors 2017

Chairman & CEO: Mary T Barra

Competitors: Ford, Toyota, Fiat Chrysler


  • A strong brand image

While GM itself may not be a well-known brand in several corners of the world, the brands it owns like Chevrolet and Cadillac have a strong image. The brand image of these cars has been influenced by their increased visibility in the Hollywood movies. Chevrolet cars and trucks are now increasingly a part of the big budget Hollywood movies. These vehicle brands are also superb in performance and reliable. Their  overall popularity globally is high.

  • Global presence

GM vehicles are present and popular globally. While US is its core market, the brand’s presence in Asian and European countries has also grown better.  Its release of new electrical vehicles will help it penetrate the global market deeper.

  • Strong Product portfolio

General Motors has a strong product portfolio of four well know brands. Some of the most iconic cars plying the US roads have been made by GM and this product portfolio continues to grow larger and stronger with new releases every year. Its new product pipeline always seems to remain fresh. It is virtually in every vehicle segment with some of its power packed monsters. From Corvetto and Camaro to pickups like Silverado and Sierra, it has a top grade product line and a deep reach in the US automotive market. One of the newest releases from GM is Chevy Volt which is a plugin hybrid. It also proves GM’s commitment to environment friendly technology. Below is a list of the brands from GM some of which are partnerships between GM and Chinese vehicle manufacturers.

  •   Baojun Buick Cadillac Chevrolet GMC Holden Jiefang OnStar Opel Vauxhall Wuling  [GM brands]
  • Vehicles loaded with safety and comfort features

Another important strength of GM are the unique features its cars are loaded with. There are several features to provide the customers with higher convenience and comfort. They include Apple CarPlay, Android Auto, OnStar, SiriusXM radio and 4G LTE wireless. Apart from it, since the ignition switch recalls, GM has deepened its focus on product safety.

  • Investing in car sharing and other new areas including automated technology.

It has partnered with Lyft to invest in car sharing and making the sharing experience better for both drivers and customers. In its annual report GM notes, “Maven offers access to highly personalized, on-demand mobility services. Customers use a mobile app to search for and reserve a vehicle by location or car type and unlock the vehicle with their smartphone. The app also enables remote vehicle functions like starting and heating or cooling. And customers can bring their digital lives into the vehicle through Apple CarPlay, Android Auto, OnStar, SiriusXM radio and 4G LTE wireless. Think of it as an ownership-like experience with the convenience of car-sharing”. (Maven is the personal mobility brand launched by GM).

  • Improving financial performance

General Motors' financial performance has grown stronger and improved in the post-recession years. The slight fall in performance in 2015 as compared to 2014 was because of the dollar exchange rates. Still, there was an improvement in net income. Its profit in 2015 reached $9.7 billion. Much of the credit for GM’s improved profits is being given to the soaring economic conditions that boosted the global vehicle industry. The brand's performance in China has also been truly marvelous where GM and its joint ventures enjoyed a 7% growth in sales from 2015 to 2016.

  • Low price of fuel leading to growth in demand in US.

The health of the US auto industry has grown better based on the declining gas prices. It has also led to a growth in demand for the pickup trucks and SUVs adding to the profits of GM. Low prices of fuel have always proved favorable for the vehicle brands.

  • Growing demand and presence in Asian markets.

In the Asian market, GM’s presence has grown stronger. Its joint ventures in China have proved particularly profitable. The joint venture delivered 3,870,587 vehicles in 2016 which marked a 7.1% increase compared to 2015.  It introduced 13 new models in 2016 in China and plans to introduce upto 60 models by 2020. In the Indian markets too, the popularity of the Chevrolet models has risen and particularly that of the small cars like Beat.

  • Acquisition of Cruise

Taking another step in the direction of automated driving the brand has acquired automated driving start up named Cruise. Automated driving is a major priority for GM and it is pushing aggressively in this direction to be the first. Its strategic investment in Lyft is also being touted as a move to augment the profits from automated driving. However, that’s a thing of future. In the meantime, its acquisition of Cruise has settled the debate on how aggressive and serious GM is for its autonomous driving plans.


  • Product recalls

Apart from the recalls due to faulty ignition switches the brand has also made a number of other recalls because of issues like faulty airbags. The ignition switches were found to be faulty in several of its models. In 2014, it was forced to recall around 2.6 million vehicles because of their faulty ignition switches. These faulty switches were tied to 124 deaths and 275 injuries. That was a major shock for the brand.

  • Losses due to dollar exchange rates internationally.

The dollar exchange rates are another major cause of worry for the brand globally. The dollar has grown stronger since the recession and has resulted in a loss of profits for GM. From Europe to the Asian markets, the brand had to bear a loss of profits because of the stronger dollar. Moreover, the increased strength of dollar has also led to increased dependence of the brand on the American markets.

  • Dependence on US markets

The dependence of the brand on US markets is high which contributes to a large part of its revenue and profits. This dependence has risen since the global economic turmoil.


  • Growing demand for fuel efficient and electrical vehicles

Increased demand for the fuel efficient vehicles presents a major opportunity before GM. The motor giant has brought its hybrid to the market and has focused on fuel efficiency and environment friendliness in its other models too. Several of the newly released models from the house of GM are more fuel efficient. Its Chevy Cruze, Chevy Malibu and Cadillac CT-6 are more fuel efficient versions. Increased focus on performance and environment friendliness will also mean higher popularity and sales for GM. However, it added Chevy Volt to its kitty, a plug-in hybrid that delivers better performance than the previous generation Volt.

  • Growing opportunities in Asian markets

In Asian markets, both the brand’s image and demand are growing. In India there is a rich market for small, fuel efficient and environment friendly cars. Even in China, partnerships with the local brands have brought good results. Sales are expected to increased further in the Chinese market. GM's Baojun in China, produces cars and SUVs whose prices are well below the other foreign owned brands.  In the commercial vehicle segment GM has partnered with FAW in China to produce Jiefang Light duty trucks. The partnership between GM and Chinese brands has worked well which shows in the sales performance of the brand. GM's China sales with its joint ventures grew 7.1 percent in 2016 from 2015 to reach 3,870,587 vehicles.

  • Automated driving

GM has invested in automated driving and is getting closer to bringing automated vehicles in the market. There could be big opportunities hidden in automated driving. However, it also depends on how open-mindedly law approaches automated vehicle technology. Still, automated driving like the other new technologies  could be the game  changer.

  • Partnerships with other brands in global markets.

In China, the brand’s partnership with local brands has been fruitful. Even in US, its partnership with Lyft has been successful. Globally, the brand can enter into strategic partnerships with other brands including Taxi brands to expand its ambit of services.


  • Rising competition in automotive industry

The competition in the auto industry has continued to rise which can be a threat for GM. It fell from its position of number 1 during the recession. It also lost some of its brands like Hummer and Saab. Toyota has moved ahead of GM to the number 1 position. Moreover, the analysts believe that sales in the US auto industry might have peaked and the result would be that GM would not be able to expand its market further. General Motors is expecting the market to grow and yet, the predictions of the analysts might come true. In that case, the brands' sales are going to be hurt.

  • Rising exchange rates of US dollar

The rise in exchange rates of dollar globally has resulted in a loss of profits. The dollar has continued to strengthen since the recession and the result has been that the international brands like GM have been forced to bear the losses. Even if these international brands are not running in losses,  their profits are being affected.

  • Increased costs of manufacturing and raw materials.

The costs of labor, technology and raw materials have increased. While the brand has been able to manage its costs of production well and some of the risk also gets mitigated by the increased profits, the rising costs still mean higher pressure.

  • Threatened brand image due to product recalls.

The faulty ignition switches due to which GM had to recall more than 2.6 million vehicles globally is a threat for brand image. The faulty switches had been tied to 124 deaths and 275 injuries. Since the ignition switch fiasco, GM has focused more on product quality and safety. Still, the brand had to recall some models now and then for safety concerns. These recalls can dent its image and affect its sales.


GM has improved its performance financially in the years since its bail out by the Federal government. The company has decided to move further with its plans related to Automated driving. In the last few years it has released several cars that rule the customers' hearts. It has invested in strategic partnerships that could mean a better future for the brand. In China also its partnership with the local brands has been successful. Another partnership that is working in favor of General Motors is that with Lyft.

Overall, the brand is in a very good position and poised for further global growth. It must invest in new partnerships in Europe and Asia to grow its brand presence. In Asia, particularly India and China the demand for small and fuel efficient vehicles has kept growing and will bring additional profits for the brand. It can bring more fuel efficient and electrical models to these markets to grow its revenue.

['SWOT' is an acronym for Strengths, weaknesses, opportunities and threats. It is a powerful strategic management tool that can help to know one's important strengths and weaknesses and to exploit the opportunities. It can also help counter the threats. Strengths and weaknesses are internal factors and opportunities and threats external. So basically, SWOT is a tool designed to help you reduce your weaknesses and counter the threats. This can improve the business' chances of success.  Companies conduct a SWOT before they embark on a new strategy or before they make an important business move like investing in a new project]

Sources: [NYtimes]  [Fortune 500]  [US News] [GM 2015 annual report]

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