Managaging Organizational Change
Course Project
Keller Graduate School of Management
Health Rights and Responsibilities HS542
Professor Michelle Gomillion
05/11/2012
I have chosen to research the topic of Both Ford and GM experienced serious issues during the pre, during and post TARP period causing them to restructure and change how they do business. Each of them reacted to these pressures differently. My paper will compare and contrast the way both companies reacted to this pressure.
According to the Wall Street Journal, UBS auto analyst Colin Langan did a comparison report on GM and Ford. His report compares Ford and GM across eight different categories: 1) financial leverage and ownership; 2) valuation; 3) U.S. market share; 4) product mix; 5) incentive trends; 6) [emerging market] exposure; 7) global EBIT margins; and 8) structural costs. Overall, our analysis directly supports our current ratings on each company, as Ford looks more favorable on most of these metrics vs. GM. In the areas he looked at the only one where Langan clearly gives GM the advantage is in market share in developing markets. “Clearly GM leads in most markets of the world. However, as we have already discussed, we believe the most important global market is North America—where GM’s market share gap with Ford has closed in recent years and is expected to continue narrowing.
I also read an article where they were highlighting the fact that GM is having hard time paying back their debt. Of the top bailout recipients, GM is the biggest laggard, the TARP watchdog says in his latest quarterly report to Congress. Bank of America, Citigroup, Chrysler and Chrysler Financial all have paid off their debt and left the TARP program. Even AIG has paid back more than 75% of what it owes taxpayers.
I find this topic very interesting because I have always assumed that GM had better cars and was simply a better company. My last three vehicles have
Keller Graduate School of Management
Health Rights and Responsibilities HS542
Professor Michelle Gomillion
05/11/2012
I have chosen to research the topic of Both Ford and GM experienced serious issues during the pre, during and post TARP period causing them to restructure and change how they do business. Each of them reacted to these pressures differently. My paper will compare and contrast the way both companies reacted to this pressure.
According to the Wall Street Journal, UBS auto analyst Colin Langan did a comparison report on GM and Ford. His report compares Ford and GM across eight different categories: 1) financial leverage and ownership; 2) valuation; 3) U.S. market share; 4) product mix; 5) incentive trends; 6) [emerging market] exposure; 7) global EBIT margins; and 8) structural costs. Overall, our analysis directly supports our current ratings on each company, as Ford looks more favorable on most of these metrics vs. GM. In the areas he looked at the only one where Langan clearly gives GM the advantage is in market share in developing markets. “Clearly GM leads in most markets of the world. However, as we have already discussed, we believe the most important global market is North America—where GM’s market share gap with Ford has closed in recent years and is expected to continue narrowing.
I also read an article where they were highlighting the fact that GM is having hard time paying back their debt. Of the top bailout recipients, GM is the biggest laggard, the TARP watchdog says in his latest quarterly report to Congress. Bank of America, Citigroup, Chrysler and Chrysler Financial all have paid off their debt and left the TARP program. Even AIG has paid back more than 75% of what it owes taxpayers.
I find this topic very interesting because I have always assumed that GM had better cars and was simply a better company. My last three vehicles have
References: Goia, Nancy (2012). “Ford Focus Electric Vs Chevy Volt: Which Would You Buy, And Why?” Retrieved May10, 2012. http://www.greencarreports.com/news/1068085_ford-focus electric-vs-chevy-volt-which-would-you-buy-and-why Krisher, Tom (2010). “Ford vs GM: Who’s Ahead?” Retrieved May 10, 2012. http://www.evolvingexcellence.com/blog/2007/01/ford_vs_gm_whos.html#ixzz1uoWn uOe at Evolving Excellence Malcolm, Andrew (2012). “Obama Pushes False GM Success Story”, Retrieved May3, 2012 http://news.investors.com/article/609777/201204301847/general-motors-not-really repaying-taxpayer-bailout.htm McIntyre, Douglas. Ford and General Motors: New trouble for the UAW. Retrieved May 11, 2012. http://www.bloggingstocks.com/2007/08/26/ford-f-and-general-motors-gm-new trouble-for-the-uaw/ Nacgman,Roger (2010). GM vs. Ford: Which Stock Is Better? (GM,F). Retrieved May 10, 2012 http://www.benzinga.com/trading-ideas/long-ideas/10/11/623337/gm-versus-ford-which one-is-better-f-gm Palmer,Ian, Richard Dunford and Gib Akin . Managing Organizational Change: A multiple perspectives approach 2nd Edition. Phillips, Matt (2010). “Ford VS. GM: Who’s the best in Detroit?” Retrieved May 3, 2012 http://blogs.wsj.com/marketbeat/2010/12/22/ford-vs-gm-whos-the-best-in-detroit-analyst-asks/ Rosevear, John. “Ford’s Electrifying Future.” Retrieved May 10, 2012. http://www.fool.com/investing/general/2010/04/20/fords-electrifying-future.aspx