The president of the union that represents workers announced on 2 May that General Motors is cutting off roughly 750 employees at its Oshawa Assembly facility as it adjusts shifts because of US tariffs.
According to a news release from Unifor, the plant, which employs about 3,000 people, will switch from operating on three shifts to two shifts beginning this autumn. Unifor would not permit GM to barter Canadian jobs in order to win over Donald Trump.
Lana Payne, national president of Unifor, described the action as a careless choice that directly affects Unifor’s members and might have repercussions for the whole network of auto parts suppliers. In addition to the 1,500 employees who work elsewhere in the supply chain, the plant will lay off about 750 workers, Payne told a media house.
The shift change “will impact approximately 700 workers”, according to GM spokesman Marie Binette’s email, though she did not call the action a layoff. “We are committed to supporting employees through the transition,” she stated.
Why Company Decided for a Layoff?
Workers in Oshawa’s car industry have been preparing for the effects of U.S. tariffs on their livelihoods, and now they are facing layoffs. Last month, President Donald Trump imposed a 25% duty on all automobile imports into the United States.
In an email to a media company, GM spokesperson Jennifer Wright stated that the company’s Oshawa facility will resume operating on two shifts due to anticipated demand and the changing trade situation.
As GM refocuses the Oshawa facility to produce more trucks in Canada for Canadian consumers, these adjustments will contribute to a sustainable manufacturing footprint. According to Unifor, light and heavy-duty Chevrolet Silverado pickup vehicles are produced at the Oshawa factory for the North American market.
These trucks are also assembled at plants in the United States and Mexico. As per Payne, GM has already given the required six months’ notice of layoffs. She stated that during those six months, she will fight back with her members every day in an attempt to persuade General Motors to change its decision.
PM Offers Sympathy to Affected Workers
In his first significant press conference since winning the federal election, Prime Minister Mark Carney expressed his “deepest sympathy” for the impacted employees and their families. The government is “fighting hard” for the auto industry, he added, and “making sure companies act in true partnership … in maintaining employment and investment in Canada.”
“If not, there will be consequences for those companies,” Carney stated. Payne called the announcement of shift reduction by General Motors before Carney and US President Donald Trump started negotiations on a new economic agreement premature and disrespectful.
Under Canada’s remission framework, Unifor urged the federal government to “review and reconsider” GM’s tariff-exempt status. According to the government’s website, this framework exempts businesses from paying retaliatory Canadian tariffs on US goods.
In order to reiterate their dedication to Canadian investment and production, the union is also requesting that Carney speak with automakers.
With the rise in Electric Vehicles around the globe the market has grown in the past decade. There is a lot of competition among brands to bring out the best Electric Vehicles. The race is both in the two wheeler and four wheeler sectors. Not to forget the bigger vehicles too in this competition! If you are planning to buy an EV or want some information about the trending EVs globally then here is a listicle. Let us dive into the world of EVs and check out the top 10 EVs in the world.
Tesla, Inc. is an American electric vehicle and clean energy company founded in 2003, known for its mission to speed up the world’s transition to sustainable energy through innovative products and solutions. The company was established by engineers Martin Eberhard and Marc Tarpenning, with Elon Musk joining shortly after as a significant investor and later becoming the CEO.
The company has pioneered several key innovations in the automotive industry. High-performance electric vehicles, advanced battery technology, and autonomous driving capabilities are their innovations. Their contribution to the evolution of electric mobility include:
Tesla Roadster
Model S
Model 3
Model X
Model Y
Tesla’s impact on the market has been profound, as it has spurred a global shift towards electric vehicles. This is after it only disrupted traditional automotive manufacturers. The company has reported increasing sales figures. Also, a significant growth in both production and delivery, reflects a rising consumer demand. Besides electric vehicles, Tesla has expanded its portfolio to include energy storage solutions. This diversification aligns with the company’s overarching goal of promoting renewable energy and reducing reliance on fossil fuels.
BYD Auto
Company
BYD Auto
Founded
1995
Market Cap (September 2024)
$99.06 Billion
Origin
China
Website
byd.com
Top EV Companies – BYD Auto
BYD Auto, established in 1995, originated as a rechargeable battery manufacturer. Then it diversified into the automotive sector. The company has evolved into a leading player in the electric vehicle market. It is driven by its commitment to innovation and sustainability. Its headquarters are located in Shenzhen, China. The headquarters has developed a robust infrastructure for research and development.
The company offers passenger cars, buses, and commercial vehicles. BYD’s electric vehicle range is characterized by:
advanced battery technology,
impressive driving ranges, and
a focus on environmental sustainability.
Models such as the BYD Han and BYD Tang have gained attention for their performance and features.
BYD Auto has made significant strides in global expansion. This has helped in establishing a presence in various international markets. The company has formed strategic partnerships and collaborations to enhance its market reach. It has invested in local manufacturing facilities to meet regional demand.
Established in 1908, GM is evolving through various phases of innovation and adaptation. The company has increasingly focused on electrification, recognizing the need to transition from traditional internal combustion engines to EVs.
The launch of the Chevrolet Bolt marked a significant milestone for GM, as it was one of the first affordable all-electric vehicles to offer a substantial driving range, thereby making electric mobility more accessible to the general public. Additionally, the introduction of the Hummer EV represents a bold step in reimagining a classic brand, showcasing GM’s capability to produce high-performance electric vehicles that appeal to both adventure enthusiasts and environmentally conscious consumers.
GM’s long-term vision is centered around achieving an all-electric future, with ambitious goals to eliminate tailpipe emissions from new light-duty vehicles by 2035.
Volkswagen AG
Company
Volkswagen AG
Founded
1937
Market Cap (September 2024)
$52.74 Billion
Origin
Germany
Website
volkswagen-group.com/en
Top EV Companies – Volkswagen AG
Volkswagen AG is undergoing a transformation. It has shifted from conventional manufacturing to electric vehicles (EVs). The company is reflecting a strategic response to the evolving automotive landscape. This transition involves large investments in R&D, and new production facilities.
The ID series represents an innovative approach to electric mobility. It features a range of models designed to cater to diverse consumer needs. This series includes vehicles such as the ID.3 and ID.4. These are equipped with cutting-edge features and sustainable design elements. Volkswagen AG is dedicated to sustainability, aiming to reduce its carbon footprint. The company has set ambitious future goals, thereby contributing to a more sustainable automotive industry.
Hyundai Motor Company
Company
Hyundai Motor Company
Founded
1967
Market Cap (September 2024)
$43.79 Billion
Origin
South Korea
Website
hyundai.com/worldwide/en
Top EV Companies – Hyundai Motor Company
Hyundai Motor Company has made significant strides in the EV sector, focusing on innovative technologies and sustainable practices. The company aims to expand its EV lineup. It looks at investing in R & D for improve battery efficiency and charging infrastructure. This in turn promotes a greener automotive future.
Among the notable electric models introduced by Hyundai are
Hyundai Ioniq
Kona Electric
The Ioniq series offers a range of options, including
The Ford Motor Company has undergone significant transformations in response to the evolving automotive landscape. This shift has necessitated a comprehensive reevaluation of their product offerings. In line with this transition, Ford has launched innovative electric models such as:
Mustang Mach-E: an all-electric SUV that combines performance with eco-friendliness,
F-150 Lightning: an electric version of their iconic pickup truck.
These vehicles not only reflect Ford’s commitment to electrification but also aim to capture the interest of a diverse consumer base seeking modern, sustainable transportation options. To solidify its position in the market, Ford has developed plans that encompass increased investment.
Rivian Automotive
Company
Rivian Automotive
Founded
2009
Market Cap (September 2024)
$13.60 Billion
Origin
USA
Website
rivian.com
Top EV Companies – Rivian Automotive
Rivian Automotive was established with a mission to revolutionize the automotive industry. It aimed at producing sustainable electric vehicles. Such vehicles were designed to cater to the needs of adventure-seeking consumers. The innovation involved environmental responsibility.
The company has concentrated its efforts on developing electric trucks and SUVs. It aims to capture a significant share of the growing market for electric vehicles. The emphasis is given to offering products that combine rugged performance with advanced technology and eco-friendly features. Rivian has attracted large investment from various sources. Such investments have positively influenced its market reception. This has led to heightened interest and anticipation for its vehicle offerings.
NIO Inc.
Company
NIO Inc.
Founded
2014
Market Cap (September 2024)
$10.96 Billion
Origin
China
Website
ir.nio.com
Top EV Companies – NIO Inc.
NIO Inc. is a prominent electric vehicle manufacturer established in 2014. The company was founded by William Li. He aimed to create high-performance electric vehicles.
NIO vehicles stand out in the crowd by their cutting-edge features, which include
advanced battery swapping technology,
autonomous driving capabilities, and
focus on user-centric design.
These attributes not only enhance the driving experience but also address concerns such as:
range
charging times
positioning
The company has experienced growth since its start. It is marked by increasing sales figures and expanding market presence. With an aim to solidify its market presence, NIO plans to:
innovate product lineup
enhance service offerings
explore international markets
Lucid Motors
Company
Lucid Motors
Founded
2007
Market Cap (September 2024)
$8.91 Billion
Origin
USA
Website
lucidmotors.com
Top EV Companies – Lucid Motors
Lucid Motors was established with the vision of redefining the luxury automotive experience. The company aims to create high-performance electric vehicles. These vehicles not only meet but exceed the expectations of discerning consumers. They emphasize a commitment to environmental responsibility and cutting-edge design.
The flagship model, the Lucid Air, exemplifies the brand’s dedication to excellence. It features impressive specifications such as
a range of over 500 miles on a single charge,
rapid acceleration capabilities, and
spacious, luxurious interior equipped with state-of-the-art technology.
The vehicle’s design integrates aerodynamics and efficiency, showcasing a sleek silhouette. The company differentiates itself from traditional luxury automakers by focusing only on electric powertrains, thereby appealing to environmentally conscious consumers who seek high-end vehicles without compromising on performance or style.
Xpeng Motors
Company
Xpeng Motors
Founded
2014
Market Cap (September 2024)
$8.26 Billion
Origin
China
Website
xpeng.com
Top EV Companies – Xpeng Motors
Xpeng Motors, founded in 2014, has emerged as a significant player in the electric vehicle industry. It is driven by a vision to create intelligent and connected vehicles. These vehicles enhance the driving experience. The company was established in Guangzhou, China.
The company is renowned for its cutting-edge technology and advanced smart features such as:
autonomous driving capabilities,
intuitive user interface,
robust suite of connectivity options.
Xpeng’s vehicles are equipped with proprietary software and hardware that enable over-the-air updates, ensuring that customers benefit from the latest advancements in automotive technology.
In recent years,it has expanded its footprint beyond the Chinese market. This expansion is characterized by:
establishment of local partnerships,
introduction of its flagship models,
commitment to meeting the diverse needs of global consumers.
The top EV companies are Tesla Inc., Ford Motor Company, Hyundai Motor Company, Lucid Motors, General Motors, NIO Inc., Rivian Automotive etc.
Who is the No. 1 EV company?
Tesla is considered the market leader in the EV sector. The American company was founded in 2003 by multi-billionaire Elon Musk.
Which country is leading in EVs?
The country which is leading in terms of the production of EVs is China. China produces more than 60% of EV batteries around the world.
What is the full form of BYD?
Build Your Dreams also known as BYD is a China-based multinational high-tech company. BYD Auto is one of the leading EV manufacturers around the world.
A company that was founded nine years ago, in 2014, and named in the honor of Nikola Tesla, Nikola Corporation, was, ostensibly, in the business of manufacturing heavy-duty commercial battery electric vehicles, fuel cell energy vehicles, and energy solutions.
After presenting several vehicle concepts between the years 2016 and 2020, leading with a natural gas-fuelled turbine-electric semi-truck, it went public on 4th June 2020. Nikola Corporation also went ahead and delivered its first two battery-electric trucks in December 2021, known as Nikola Tre. However, by September 2021, the Securities and Exchange Commission and the Department of Justice had already launched an investigation into allegations of security fraud by its founder and former CEO Trevor Milton. It was at this time, that the unraveling began.
Trevor Milton founded Nikola Corporation in Salt Lake City, Utah in the year 2014 and announced that 5000 Nikola One hydrogen-powered glider trucks would be built by 2016. They were to be built by Fitzgerald Glider Kits in Tennessee. By the year 2019, Nikola had acquired 389 acres of land in Coolidge, Arizona for a total of USD 23 million. The company announced that the factory construction work was slotted to begin by 2020, truck construction a year later, in 2021, and by 2023, Nikola would be fabricating 35000 to 50000 trucks per year.
By March 2020, Nikola Corporation and VectoIQ Acquisition Corporation, announced a merger that resulted in the combined company, NKLA, being listed on the NASDAQ exchange. The Nikola stock began trading on 4th June 2020, a day after the merger was officially completed. Within the space of one week, Nikola shares doubled as the investor’s interest heightened leading to a continuation of betting on the growing potential of electric transport. This was followed by the company beginning to take order reservations for the truck, even though customers had as yet not even seen a prototype.
The growth continued and by August 2020, Nikola Corporation reached a valuation of USD 13 billion. On September 8, 2020, Nikola Corporation entered into another strategic partnership with GM (General Motors). The partnership stated that GM would acquire an 11% stake in Nikola and also nominate one member to Nikola’s board. Consequently, GM would also begin the production of Badger and supply fuel cells and batteries to Nikola, globally. Unsurprisingly, this resulted in Nikola’s stock increased by 50% as the announcement was received with enthusiasm.
Unraveling The Fraud
It all began with the short-seller firm, Hindenburg Research releasing a report on 10th September 2020 that outright accused the company’s founder Trevor Milton of perpetrating ‘an intricate fraud’. Trouble mounted when this report was confirmed by Financial Times and Research Enquirer that showed a Nikola One rolling down a slope using the natural force of gravity instead of onboard propulsion. In response to these claims, Nikola stock fell by 10% and the GM stock took a hit of 4%. Within a couple of days, by September 12th, Nikola stock witnessed a sharp drop of 36%.
As outraged as Nikola was with these claims and threatening legal action against Hindenburg, its troubles were far from over. These claims had interested the US Attorney’s Office for the Southern District of New York. September 14th saw reports stating that the Securities and Exchange Commission had begun investigating allegations of fraud against Nikola Corporation, followed by the Department of Justice beginning its investigations a day later.
Within a week, by September 21, Trevor Milton resigned from his designations as Executive Chairman and Founder while the share price of Nikola continued to drop surrounded by news of the allegations. This was quickly followed by unraveling partnerships and further share price fall.
Nikola Motors Fraud
BP (British Petroleum Company PLC) canceled a potential partnership that would have developed hydrogen refueling stations for Nikola’s EV trucks. November 2020 saw GM backing away from the proposed deal to buy an equity stake in Nikola Corporation as well as canceling the production of the Badger electric pick-up truck. A month later, another announced partnership with Republic Services was terminated. This partnership was in formation to jointly develop zero-emissions garbage trucks.
How Nikola Surged Ahead
By February 2021, Nikola rallied a little and publicly canceled Powersports unit and its plans to produce them. However, they stated that by the fourth quarter of the year, their intention was to produce between 50 and 100 Nikola Tre Vehicles. In June of the same year, Nikola Corporation invested USD 50 million in a new hydrogen factory to produce fuel for semi-truck fuel stations. The effort was to be spearheaded by Wabash Valley Resources. A month later, by July there was an announcement to add five new class 8 truck dealers in Arizona, Texas, Colorado, California, New Mexico, Delaware, Florida, Maryland, and Virginia.
Who Is Trevor Milton
Trevor Milton – Founder Nikola Motors
Trevor Milton was born in Utah and is one of five siblings. He pursued a career in sales and marketing after opting to drop out of Utah Valley University. Milton’s career included various businesses that began with his first venture, an alarm sales company called St. George Security and Alarm. He exited the business for USD 300,000. He immediately launched an online classified advertisement website that sold used cars. However, the company failed and eventually closed. He launched dHybrid Inc., which was in the business of retrofitting commercial trucks with engines that could run on natural gas. It ran into trouble with an investor that resulted in the company closing down. He then launched dHybrid Systems which, according to his claim, was purchased by Worthington Industries. It was after this, that Milton founded Nikola.
Following the allegations and investigations into him, Milton surrendered himself and pled not guilty to all charges leveled against him. However, in June 2022, Milton was charged with additional wire fraud, and by October 2022, was found guilty of one count of securities fraud and two counts of wire fraud.
Conclusion
In July 2021, when Trevor Milton was indicted, Nikola Corporation said – “We remain committed to our previously announced milestones and timelines are focused on delivering Nicola Tre-battery electric trucks later this year from the company’s manufacturing facilities.”
A little over a year later, by August 2022, Nikola announced the acquisition of the battery company, Romeo Power. The process was completed by October 2022. It remains to be seen how the company executes the upcoming opportunities.
FAQs
What is the Nikola Motors fraud scandal?
The Nikola Motors fraud scandal involves accusations that the electric truck maker, Nikola Corporation, misled investors and the public about its technological capabilities, and achievements. Nikola denied the allegations and launched its own investigation.
What was the role of founder Trevor Milton in the fraud scandal?
Founder Trevor Milton was accused of making false statements to investors in the Nikola Motors fraud scandal. He resigned after the allegations emerged.
What actions did Nikola Motors take to address the fraud allegations?
After the fraud allegations were made, the company denied the accusations and launched its own investigation into the matter. The company’s Board of Directors formed a special committee to oversee the investigation.
What is the impact of the fraud allegations on Nikola Motors’ stock prices?
The fraud allegations caused a significant drop in Nikola Motors’ stock price. While the stock price has since recovered somewhat, it remains below its peak levels from earlier in 2020.
Company Profile is an initiative by StartupTalky to publish verified information on different startups and organizations. The content in this post has been approved by General Motors.
General Motors, a multinational corporation based in the United States, was the leading automobile company for 77 years until it was surpassed by Toyota in 2008. Despite this, GM has consistently ranked among the top 15 companies on the Fortune 500 list, and recently moved up from No. 8 to No. 5. With operations in eight countries and four brands, GM is also involved in joint ventures with Chinese automakers and produces military vehicles for the US government.
General Motors – Company Highlights
Company Name
General Motors
Headquarters
Michigan, US
Sector
Automotive
Founder
William C. Durant, Charles Stewart Mott. Frederic L. Smith
General Motors are the manufacturer, marketer, and distributor of vehicles and vehicle parts. GM is a public company owned by shareholders. General Motors formerly known as General Motors Corporation has been the world’s largest motor-vehicle company for most of the 20th and early 21st century. With a global presence, General Motors operates manufacturing and distribution plants not only in the United States and Canada but also across many other regions of the world. The company is majorly involved in the production of automobiles and trucks which also includes automotive components.
General Motors – Automotive Industry
The automotive industry comprises a wide range of companies and organizations involved in the business of manufacturing, design, marketing, and distribution of automotive products. The automotive industry began in the 1860s with a lot of manufacturers that pioneered change in the carriage system. Earlier the manufacturing process involved a lot of labor from engineering to very little work. At the beginning of the 1960s robotic equipment was introduced and now most of the work is automated. General Motors is been a leading manufacturer in the industry for decades.
General Motors – Founders and Team
The origins of General Motors date back to September 16, 1908, when the company was originally founded. However, the present-day version of the company is the result of a reorganization that took place on July 10, 2009. General Motors was established by William C. Durant, Charles Stewart Mott, and Frederic L. Smith.
William C. Durant
William C. Durant – General Motors
William Crapo Durant was a leading pioneer of the United States automobile industry. He co-founded General Motors and Chevrolet. He was the one who introduced the system of multiple marques with different automobile lines. He also founded Frigidaire.
Charles Stewart Mott
Charles Stewart Mott – General Motors
Mott was an industrialist and businessman in America. He co-founded General Motors along with the other two. He initiated the idea of building colleges and pledged $1 Million towards the project. He also founded the Flint Senior College now the University of Michigan – Flint.
Frederic L. Smith
Frederic L. Smith – General Motors
Frederic Latta Smith was the pioneer of the automobile industry. He was one of the founders of the Olds Motor Works before he co-founded the General Motors Corporation in 1908. During the early years of the Association of Licensed Automobile Manufacturers Smith managed to be its president.
General Motors – Startup Story
In the early 1900s, the General Motors company was formed under the leadership of William C. Durant. The formation was to consolidate several motorcar companies like Buick, Oldsmobile, Oakland, Marquette, and other several autos. This consolidation also includes Reliance and Rapid Trucks. The auto giant was the innovative body that first introduced the electric self-starter in 1912. Though it became obsolete in the beginning. GM became the leading American passenger car manufacturer in 1929.
Durant first formed the company as a holding company, with Charles Stewart Mott as a partner. The name was initially borrowed from General Electric. In 1919, with the acquisition of Guardian Frigerator Company, became the GMAC, General Motors Acceptance Corporation. GMAC provides financing to automotive customers and the acquisition was renamed Frigidaire.
In 1920, GM heavily competed with the Ford Motor Company under the leadership of Alfred P. Sloan. He implemented the pricing strategy from least to most expensive vehicles in his annual model changes. Sloan also created a market for the previous year’s car models as used cars. In 1921, GM patented the tetraethyllead (gasoline) compound and also developed Chlorofluorocarbons both were banned in the later years as harmful ingredients for the biosystem. In 1926, the Pontiac brand was introduced by GM along with the insurance program for its employees. In 1927, Sloan created the ‘Art and Colour Section’ of GM and Harley Earl was its first director. The automobile design created by Earl is still in practice. After Earl, Mitchell took over the design for GM.
GM invented the breakthrough in heat treatment by introducing the Jominy end-quench test for the hardenability of carbon steel in 1937. In 1939, the company placed its feet in the vehicle insurance market by finding the Motors Insurance Corporation. In the same year, the company introduced the world’s first affordable and successful automatic transmission.
Vast quantities of production happened during the times of world war 2 when the company supplied armaments, aircraft, and vehicles for the Allies of World War 2. Its German factories were destroyed by the U.S. forces during the war for which a compensation of $32M was received by the company.
In 1962, the first turbocharged engine was introduced by the GM for the Oldsmobile Cutlass Turbo-Jetfire. In the next two years, the company introduced its “Mark of Excellence” logo and trademark at the 1964 New York World’s Fair. The company used this mark as its main corporate identifier until 2021.
The first-ever hydrogen fuel cell car was released by General Motors Company in 1966. Though fuel cells were already in existence, GM was the first one to use them to power the vehicle. The budget to use the power cell supplied by Union Carbide was millions of dollars. It also introduced the first-ever turbochargers and gas turbine vehicles powered by kerosine, but later the techniques were abandoned due to the oil crisis in 1973.
GM produced the first rear-wheel anti-lock braking system for two vehicles namely the Toronado and Eldorado. The Oldsmobile Toronado is also the first retail car with a passenger airbag introduced in 1973. In 1975, GM installed the first catalytic converters in its models. The converters are exhaust emission control devices that convert toxic gases into less-toxic pollutants. Year after year GM proved itself by introducing various new techniques and innovations in the market.
In 1987, GM built the Sunraycer, which won the inaugural World Solar Challenge. This invention was a showcase of advanced technology. Later, in 1990, GM debuted the EV1 concept which is a battery electric vehicle at the LA Auto Show. But the EV1 lease was available to only a few dealers in California and Arizona. Production was stopped for this product as it would not be profitable for the company. This disappointed many people which led the company to deactivate and destroy the EV1s, 40 of which were donated to museums. The documentary film ‘Who Killed the Electric Car?’ covers the story of EV1. In 1993, Lotus cars by GM were sold to Bugatti.
It was in 1996, that GM completed the corporate spin-off of Electronic Data Systems. The next year, GM sold its military businesses of Hughes Aircraft Company to Raytheon Company. Being the king of inventions in the automotive industry, GM introduced the first full-sized pickup truck hybrid vehicle, the Chevrolet Silverado Sierra trucks in May 2004. Other than these mild hybrids, GM also developed another debutante using hybrid technology, along with DaimlerChrysler and BMW. In the same year, GM sold the electro-motive diesel locomotive design to Berkshire partners and Greenbriar Equity group.
GM added its “Mark of Excellence” emblem in all its productions till the reorganization in 2009. In 2005, GM newly created the vice president position to lead a global automotive design organization and made Edward T. Welburn the first VP. 2006 was the year when GM introduced the yellow gas cap on its vehicles to identify them as cars operated using E85 ethanol fuel and Saturn Vue Green Line.
In 2008, GM concentrated on reducing landfill waste to achieve the status of landfill-free production. It started recycling and reusing the wastes from manufacturing processes. This was the year GM was conscious about the environment and offered a 2-mode hybrid system in most of its vehicles. It also installed the world’s largest rooftop solar power installation in its manufacturing plant in Zaragoza.
In March 2009, the company received bailouts of $17.4 B under the presidency of Barack Obama. Then, GM motors filed a chapter-11 reorganization and sold its assets including the logo to the new company and thus the new GM was born. General Motors Canada was not a part of Chapter 11 bankruptcy. The US department of treasury invested $49.5 B through the Troubled Asset Relief Program in GM and recovered only $39B with a loss of $10.3B. It also invested in the GMAC financing companies and had a profit of $2.4B. In 2009, the company shut down the production of the Saturn and Pontiac brands due to a lack of potential buyers. It also sold Hummer and Tengzhong in the same year.
After the reorganization, the company appointed a new CEO and made changes to the BOD team. The company became public through its public offerings in November 2010. This is one of the world’s top five largest IPOs to date. In the same year, the company became profitable. In the later periods of 2010, GM introduced extended-range electric vehicles (EREV) with backup generators powered by gasoline.
In 2013, GM and Honda partnered to develop a fuel cell system and hydrogen storage technology. They are the leaders in fuel cell technology holding most of the patents for fuel cells from 2002 to 2012. In 2015, the second generation Volt was launched in the United States and Canada. In 2017, GM introduced an autopilot feature in certain models of cars. In the same year, the GM Venezolana plant was seized by the Government of Venezuela in Valencia, Carabobo.
In November 2018, GM laid off 14000 employees in North America as it comprised the workforce by 15% and executive staff members by 25%. In 2019, GM ceased the production of the Chevrolet Volt and announced to begin of the production of the EV model in Lake Orion, Michigan. In January 2020, GM announced the return of the Hummer nameplate within the GMC portfolio known as GMC Hummer EV.
GMC Hummer EV
During the Covid period, GM assisted Ventec life systems to produce Ventilators. In September 2020, GM announced its partnership with Nikola Corporation to engineer and manufacture the Nikola Badger. Later, GM was committed to increasing capital investments in electric vehicles. GM in January 2021 announced its plan to stop the production and sales of fossil fuel vehicles as part of its goal to reach Carbon neutrality by 2040. It also announced its plan to start an automotive battery and battery pack laboratory in Michigan. GM facility at Brownstown Township is chosen to be upgraded as a battery pack plant. In April, GM announced its joint venture with LG to build batteries for electric vehicles.
Lately, GM also made the largest investment project in its home state, Michigan to invest $7B to convert plants to produce electric plants and build new battery plants.
Leading car brands in the United States in 2021, based on vehicle sales
General Motors – Mission and Vision
The original mission statement of GM is to earn customers for life by building brands that inspire passion and loyalty through not only breakthrough technologies but also by serving and improving the communities in which we live and work around the world.
The vision of the company is to stand together to drive the world forward. The statement is, “Everybody in. Our goal is to deliver world-class experiences at every touchpoint and do so on a foundation of trust and transparency.”
General Motors – Name, Tagline, Logo
General Motors – Logo
General Motors Company was formerly known as General Motors Corporation. The logo of GM fades from light blue to dark blue with GM letters in lowercase type. The logo intends to evoke the clean skies of a zero-emissions future and the energy of the Ultium platform. The company had only two basic emblems from the beginning of the company which is a script wordmark and a bow-tie design. The most recognizable bow-tie symbol was introduced in 1913 by William C. Durant on the Royal Mail model.
General Motors – Business Model
General Motors uses the Generic Strategy from Porter’s model as its business model. The competitive strategy of this model is cost leadership. This creates a competitive advantage based on the low costs of products.
General Motors – Revenue Model
The main source of revenue for the company is vehicle sales. It also earns an equal amount of revenue from its financing companies called GM Financial. The main stream of income for the company from the beginning is the manufacturing, assembling, and distribution of vehicles.
General Motors – Employees
General motors currently have 1,57,000 employees working in the company. The reward program at GM includes compensation, paid time off for holidays, high-quality health care, and GM family savings on vehicles, parts, and services.
General Motors – Challenges Faced
GM was the leading automobile industry for almost 77 years before its bankruptcy in 2009. The bankruptcy was due to the rising gas prices as consumers started looking elsewhere for fuel-efficient cars. When the sales went down, the company struggled to meet even the fixed cost expenses.
General Motors – Mergers and Acquisitions
General Motors had several acquisitions all these years. Here is a timeline glimpse of the latest and key acquisitions made by the company.
Acquisitions
Acquired Date
Cruiser RV
March 2016
Cruise
March 2016
Sidecar
January 2016
Cadillac
July 1909
Vauxhall Motors
1925
Packard Electric
1932
Euclid Trucks
1953
General Motors – Awards and Achievements
General Motors bagged 4 awards in 2018 and 3 awards in 2017. It won the best CEO award in 2018.
General Motors – Competitors
General Motors ruled as a monopoly for the most of 20th century and the earlier times of the 21st century. But, it also has some heavy competition in the market like Tesla, Toyota, Chrysler, Honda, and Ford.
FAQs
What is General Motors known for?
General Motors Co. engages in the designing, manufacturing, and selling of cars, trucks, and automobile parts.
What does General Motors own?
General Motors owns Buick, Cadillac, Chevrolet, and GMC. Hummer returned as a GMC sub-brand. GM has a formal partnership with Honda to co-develop EVs.
What is the biggest controversy faced by GM?
GM was accused of having assisted the Nazis war during the second world war.
What was the reason for the failure of GM in India?
GM failed in India due to poor product planning and the lack of adaptability to the market.
The global automotive and tech industries are on the edge as a wave of a supply shortage of semiconductors has hit them hard and how. Computer chips manage or probably run almost everything under the sun.
From nuclear plants to the internet cables, stabilizing suspension systems, and regulating engine temperatures, we need them more than ever since technology surrounds us in a way that we are yet to comprehend.
Computer chips are almost everywhere, in the cars we drive, in the smartphones we use, in devices like refrigerators, laptops, television sets, etc. We can’t imagine our lives without these. The shortage of these chips has turned down a few economies and soared for a few others around the globe.
Semiconductors or chips as we commonly know them are basic structures used for encrypting logic and memory functions in automobiles, phones, laptops, and gaming devices. Semiconductors are integrated or electronic circuits printed on conducting materials, the most common being silicon. They are the basic building blocks for making computers and running software.
Over the decades, developers have managed to squeeze more circuits into tinier circuits making our computers and devices smaller and cheaper. The semiconductor fabrication is based on several transistors, the smallest part of the chip’s electronic component, per square millimeter. The factories or facilities that produce semiconductors are known as “Fabs”.
The most advanced Fabs are known for semiconductors that measure 5 nanometers. That’s a millionth of a millimeter. Smaller the semiconductor, the higher the transistor count per square millimeter. The most highly functioning semiconductors are ones having a density of 100 transistors per square millimeter.
Scarcity of Semiconductors around the Globe
A chain reaction was set off when the pandemic hit us. As governments around the world imposed strict lockdowns, the demands for automobiles took a sharp U-turn. The automobile industry is one of the largest consumers of electronic chips as cars are turning into devices with power windows, machine control, and other features that use Artificial Intelligence. All these functions are integrated through semiconductors.
Automakers like General Motors and Ford shut down several plants due to a decline in demand and production was brought to a halt. The sales fell drastically and companies cut short on their purchases of semiconductors.
While the pandemic forced us to stay at home the need for indoor entertainment rose substantially. This resulted in an increased demand for tablets, smartphones, and laptops worldwide. The ripple effect called upon a higher demand for semiconductors in the tech industry. Tech companies began roping in more chips and some even stacked a few envisioning the shifts in the global demand.
The market recovered at a better pace than anticipated and the demand for the auto making companies started to re-surface. Meanwhile, the tech industry gorged up 70% of the semiconductors being produced and left the automakers high and dry.
The USA is the largest producer of semiconductors in the world. Due to reforms implied by former President Donald Trump, the USA severed ties with Chinese companies and limited the chip sales export to China. China stockpiled chips and other countries followed suit.
The American break up with Chinese companies turned the demand wave to TSMC, Taiwan Semiconductor Manufacturing Company, and other East Asian companies. TSMC and Samsung created a monopoly over the production of semiconductors which add up to 70% of the total production.
America’s semiconductor production has plummeted to 12% from 37% since 1990. Consecutive changes in political leaders and bare minimum funds have discouraged the overall production.
Other factors that catered to the scarcity were a huge fire in a Japanese chip factory in October 2020 and a cold snap that withered two semiconductor factories in Texas.
The TSMC and other east Asian companies are working under extreme pressure to meet the demand worldwide. It might sound exuberant for the company, but it is far from what reality is.
One might wonder why can’t more Fabs be built in order to sustain the demand. Fabs have peculiar prerequisites such as temperature-controlled environments, dust control, highly volatile pieces of equipment, and a minimum of five years of time to get it ready for production.
Not to mention the sky-high cost requirement for setting up a Fab. No wonder the largest producer of chips America, is far from its competitors lacking the funds and support from its government.
Reportedly, the demand has rocketed due to the requirement of semiconductors in the production of 5Gsmartphones. Every advancement in the electronic industry is largely based on the exploitation of semiconductors. As the world gets 5G ready, companies have massive supply demands for semiconductors.
Indian automakers depend largely on imports of semiconductors. The worldwide demand, too few supplying agencies, and the waiting period have the Indian automakers worried as they import electronic requirements totaling to Rs 3000 crore every year.
“The big concern for the auto industry and Mahindra, and in fact for the world, is the semiconductor shortage. (It is) something that we’re very perplexed with, and something where the end is not clearly known as to when this fall will go away,” Pawan Goenka, MD, and CEO of Mahindra & Mahindra, said during a press conference on the company’s Q3 results, on February 5.
During Tata Motors’ press conference on its Q3 results on January 29, PB Balaji, CFO, Tata Motors, said that up until January, there has been no impact on the company due to the shortage of semiconductors. “Having said that, the risks are real and conversations are happening with all tier-1 and tier-2 suppliers and with the semiconductors industry as well to ensure that supplies continue.
From a demand perspective, we are going very fast, and that’s also adding to the pressure that we have. This is something that is being managed on a live basis, and we will ensure that we do our best to minimize the impact.”
“This is a challenge, and you need a hell of a lot of firefighting to get through,” Balaji added.
What happens next
The shortage will entail a while longer as the USA finds solutions for the production and sale of semiconductors. The world waits as new policies are put in place and the trade resumes.
Chip companies might be benefitting from the new demand drive but this locks them up in a long-term deal which brings more pressure on production.
The biggest winners are companies such as California-based Applied Materials and Lam search and Japan-based Tokyo Electron who make the highly complex and expensive manufacturing equipment required to produce semiconductors.
FAQ
Why is there a shortage of computer chips?
The pandemic resulted in an increased demand for tablets, smartphones, and laptops worldwide. The ripple effect called upon a higher demand for semiconductors in the tech industry.
Where are most semiconductors manufactured?
Taiwan, South Korea and China are the countries where most semiconductors are manufactured.
Why are semiconductors so important?
Semiconductors are an essential component of electronic devices, , computing, healthcare, military systems, and transportation. In short Semiconductors are the Brains of Modern Electronics.
Conclusion
Companies around the world believe that the demand for chips will barely slow down. The share prices of TSMC and Samsung have grown over 190% and 61% respectively over the last few years, all thanks to the shortage of chips.
The automakers falling short of chips, need to take a long hard look at their supply chain management and cost-effective pricing as many automobile companies saw a hike in their products due to this scenario.
This might exhibit as a complex problem for bigger players in the global market but the end result is inflicted upon the consumer who is forced to pay a higher cost.
