5 Items on GM’s Laundry List to Address in the Future

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General Motors (NYSE:GM) has made its mark on the world as one of the largest auto manufacturers in existence, though the road to this point has been fraught with difficulties and setbacks, including a significant decline in U.S. market share over the last several decades. A paper published though the National Bureau of Economic Research by Susan Helper and Rebecca Henderson attempted to shine some light on what sparked that decline, and we have used it as a basis to identify five key factors that GM will need to work on moving forward.

Helper and Henderson — who hold the copyright for the work — explore why General Motors lost its edge and allowed the market to be left wide open to Asian manufacturers in the 1980s and ’90s. While their findings are not necessarily surprising, the report certainly identifies some valuable areas where GM still has room for progress.

Here are five notable things that General Motors can focus on this year and moving forward.


1. Continue to improve product quality

Product quality has been a thorn in the side of American manufacturers for some time. While quality has undoubtably improved dramatically over the years, the 1980s and even the 1990s proved to be a troublesome period for General Motors, and it was in that window that Japanese manufacturers — namely Toyota (NYSE:TM) — managed to gain a foothold in the American market.

Helper and Henderson assert that General Motors was “seemingly unable to adopt the managerial practices that enabled its Japanese competitors — particularly Toyota — to introduce cars of much higher quality and much better design at significantly lower cost, even though GM was, at least initially, much richer than its rivals.”

Today’s automotive market is a vastly different place than it was two or three decades ago, but it’s arguable that GM has shaken off its subpar quality reputation. Its cars and vehicles have improved greatly, though the company will have to continue to show that its products are on the same level as its competition.

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