Though the company hopes to increase productivity and profit by the downsize, their will be tremendous effects on those who are forced to leave their careers, and also those who are lucky enough to stay with the company. On June 16, 1903, an intelligent man named Henry Ford and 11 associates opened the Ford Motor Company with $28,000 in cash, like most companies Ford started out modest, but soon rose to be the most successful manufacturer in the country. One thing that separated Ford from all other manufacturers was the assembly line. The assembly line allowed Ford to produce cars faster and more efficiently that many other companies. By the time the 50’s had reached, Ford had adapted to fulfilling its customers needs, and had increased the number of stockholders to 350,000.
Oldsmobile began using assembly lines in 1901. However Ford did something that drastically sped up the process. Ford mass produced parts for his vehicles and created the moving assembly line which took the average build time of one vehicle from twelve hours down to one and one half hours. By doing this Ford was able to speed up production and lower production cost. Ford could now not only sell the Model T for a significantly lower price than other automobiles but he could sell thousands more than his competitors.
This day in age everyone has low rates ,cash rebates but now employee discount, good thing GM was the leader of the pack. The financial outlook for present GM is superb and the employee discount drastically sparked sales for a temporary time period. The reason GM had to run an incentive program was the cause of abundance of Inventory and employees are too expensive to maintain. (Pension, benefits…..) Gm had an increase in finished product, service parts, etc… between 2003 and 2004 in other words, total inventories increased by nearly one million dollars, as sales decreased during that time period. GM has also seen a rise in healthcare and other benefits in the United States.
The Value of the Assembly Line in Automobile Manufacture In 1913, an innovation in automobile manufacture was born when Ford Motors experimented with winches and ropes to pull the chassis down a line while the assemblers stood in one place with their parts piles. The old process where workers moved in teams down the line, receiving their car parts from "parts runners" at each chassis as they arrived, was replaced by the automated assembly line, thus radically reducing by about 70 percent the original 17-hour labor input in the traditional moving team system. Since then, cars began to be produced with increasing flexibility and economy. The State-of-the-Art BMW Plant in Leipzig The newly-opened manufacturing plant of BMW in Leipzig, Germany boasts of a high-tech assembly line that transports the chassis from one production station to another with the speed and ease that carries with it the promise of producing the planned capacity of 650 BMW vehicles per day by 2007. Located in three buildings arranged in a circle around the open-structure central building, the assembly line production is clearly visible to all employees.
The retiree health care cost was removed from the main balance sheet so that it could be handled more effectively. In 2007 Ford reached a historic agreement with 46000 hourly workers. The agreement also gives hourly workers the job security they were seeking by having the company commits to substantial investments in most of its factories. The automaker reported the largest annual loss in company history in 2006 of $12.7 billion. On June 2008, Ford lost its Jaguar and Land rover brands to TATA Motors.
The trend of consolidation has continued throughout today. Presently, this is evident in the recent acquisition of Chrysler by Daimler-Benz in late 1998, thus forming DaimlerChrylser. These consolidations have proved beneficial to consumers since companies have been able to reduce costs and pass those savings on to the customers. Some of the other major examples of consolidation are Nissan selling off a controlling 37% interest to Renault; General Motor’s 49% ownership of Isuzu; and Ford’s 33% majority of Mazda. Other efforts to become more competitive have translated into the European Union dropping trade barriers and European carmakers employing cost reducing efforts.
One of marketing’s strongest features is its empiricism. What science did for perception, marketing does for production. It tests intuition and insight against empirical fact. Henry Ford thought he knew what people wanted from a car: cheap, reliable, and black. Ford sold millions of model-Ts in the 1920s with this mass marketing strategy.
General Motors is a long established corporation, which has had a profound affect on the American people and the American economy. The corporation has prided themselves on producing automobiles at the lowest cost, while remaining a style leader of the industry. Bankruptcy with a government buy out in 2009 caused reorganization, a battle to transform, reinventing a new GM corporate culture. In 2014, Generals Motors topped the list as one of the nine most damaged brands. What caused General Motors to get such a tarnished reputation, was it a scandal-laden culture and mismanagement, putting profit over safety with massive cover-ups, or a combination of both?
Gasoline prices of approximately $2.00 per gallon started taking a huge bite out of family budgets in 2004, and many middle-class consumers who owned fuel guzzling SUVs and pickup trucks began to wish they had vehicles that were much less expensive to operate. By 2005-2006, with gasoline prices in the $3.00 range, the party was over for traditional, large SUVs. While gasoline prices moderated during much of 2007, they were still in the $2.70 range in most markets. One result was the phenomenal demand for Toyota's Prius hybrid car. Toyota responded by raising the price and planning production increases.
The plan led to the reduction and or closure of “14 factories, 2,400 dealers, 21,000 hourly-paid jobs, 8,000 white-collar jobs,” (The Economist) and by doing, so it would be able to save $79 billion in order to pay off upwards of $172.81 billion it had accrued in debt. The overhaul also called for the resignation of their Chairman and CEO, Rick Wagoner. In my research paper I would like to explore how different the markets, as well as union greed and board member mismanagement contributed to the failure of General Motors in 2009. I will take a close look at the collapses of the American Housing market in 2007 as well as the how the price of gasoline nearly doubled in 2008 and what roll those played within GM’s bankruptcy. While exploring these different markets, greed and mismanagement I intend to illustrate how they factored into what could be called the “perfect storm” toppling the Automotive Giant and leading to its