SWOT Analysis on the Domestic Operations of GM

Strengths

The largest market share is apparently a prominent strength of GM. The company has been holding the largest market share in U.S. automobile market for decades. This can translate to the trustworthiness and brand recognition that the company has in U.S. customers.

Wide range of products is also an advantage. Currently, GM is offering a variety of products under the brand names of Chevrolet, GMC, Cadillac, Buick, Pontiac, Saturn, Hummer, Saab, Daewoo, Opel, and Holden. The wide range of products can translate to high brand awareness and perception.

Weakness

One of the weaknesses of GM must be the decline in market share. In spite of holding well its 1^st position, GM’s market share has kept declining since 1984. As such, the gap between GM and its competitor especially Ford and Toyota has been significant reduced. This may result in losing its position as the largest automaker.

Quality problem is another weakness of GM. Some mass recalls of more than more than 1.5 million vehicles and the Government investigation of over 6 million vehicles of the company for quality and safety reasons in 2010 make it difficult for the company to improve the brand image.

Opportunities

The recovery of the U.S. automobile industry must be great opportunity of GM. After years of decline, the statistics in 2010 indicate that the U.S. automobile industry is recovering. As the leading manufacturer in the industry, this can be translated to opportunity for GM’s sales growth.

Environmental concerns also offer other opportunity to the company. The event that GM’s Chevrolet Volt, a hybrid car of GM, is named North America Car of the Year would be an indicator of the company’s innovation that help the company improve its brand perception in coming years.

Threats

Intensive competition from overseas automakers would be the outstanding threat to GM’s position. Detroit Three used to dominate the U.S. automobile market. However, majority of the market is now shared by seven biggest automakers including Detroit Three and four overseas manufacturers. The presence of overseas automakers in top seven signals increasingly fierce competition and predictable threats to GM’s position.

High cost of healthcare is another noteworthy threat to GM. It is known that cost of healthcare for each vehicle produced at GM is much higher than that at its competitors. Unless the company implements appropriate reform, this practice will undermine GM when facing price competitions.