Managing in Troubled Times Case Study

Case Title:

General Motors in Europe: The Challenging Times

Abstract:
General Motors Europe (GME), the European division of the world's largest automobile manufacturer General Motors, started reporting protracted losses and declining market share from 1999 due to the weak European market. New liberalised car dealership rules, an unsuccessful restructuring plan, a failed alliance with Fiat Auto and the growing dominance of the Asian carmakers further worsened the situation. GME's position slid from second to fifth in the European market. In 2004, to save the ailing European division from further decline, its new chairman Frederick Henderson, formulated a restructuring plan focusing on reduction of costs, plant capacities, downsizing and integration of functional departments. But according to the industry analysts the task of restructuring is likely to be tough and the layoffs expensive, with weak markets for the next two years.

Pedagogical Objectives:

• To discuss the efficacy of the restructuring plans for General Motors in Europe.

Keywords : General Motors Europe; Fiat Auto SPA; European automotive industry; Frederick Henderson; Managing in Troubled Times Case Study; Layoffs and plant closures; European automobile makers; Asian automakers; European economic recession; Project Olympia; EU (European Union) automobile dealerships regulations; Adam Opel AG; Competitive strategies; Acquisitions and mergers