This paper will measure the impact of quality management between the leading American automobile manufacturer, General Motors to the leading foreign manufacturer Toyota. The paper will analyze the differences in the history of each company their quality management tactics. The consumer’s trends and tastes have changed over the years in the beginning America wanted its muscle car and in today’s day and age the American consumer wants luxury, quality, reliability, and a fuel-efficient automobile at a low price. Furthermore it is imperative General Motors needs to strengthen their quality control and go back to the basics doing what they did best, build the “American Car.” While they could learn from Toyota in the quality management division they will have to differentiate themselves from Toyota. They have been trying too hard to build a better Toyota or Honda when in actuality they need to build a better Chevrolet, GMC, Cadillac, or Saturn.

Preface

Quality is something everyone strives for in a consumable good. Quality is especially important when it comes to bigger purchases such as automobiles. The American Automobile industry has suffered a loss in market share to the foreign automotive companies. One of the reasons for the loss in market share is quality management. The quality of an American automobile is just not the same as a foreign name brand like Toyota. This paper will compare and contrast the differences in Quality Management of General Motors the leading American competitor to the leading foreign competitor Toyota. “In 1950, America produced 79.4% of the world’s automobiles. By 1981, its share had slipped below 30%” (Yates 1983). In 2007 the American Automakers held 52.6% of the market share in the United States, which was up from 2006 at 51.5%. As the market shares continue to fluctuate GM is the front-runner of the American automobile industry with 23.8% of the U.S. Market share while Toyota holds 16.2% of the U.S market share. (Autodata corp.)

Part 1: History of General Motors

September 16, 1908 General Motors was formed. At the time GM consisted of Buick, Pontiac, Cadillac and GMC. In 2008 GM consists of Chevrolet, GMC Pontiac, Buick, Cadillac, Hummer, Oldsmobile Saab, and Saturn. By the 1920’s the demand for automobiles grew to unexpected heights. “General Motors set the pace of production, design, and marketing innovation for others to follow” (GM.com). By 1929 General Motors was established in India, Brazil, China, Canada, and Europe. Quickly becoming one of the world’s leaders in automobiles.

In 1942 World War II was upon us and GM converted 100% of its operations to the war effort. GM delivered more than $12 billion worth of materials including airplanes, trucks and tanks. During the 60’s and 70’s the fuel prices started to rise and foreign competition led to the downsizing of the vehicles across all of General Motors lines. People were beginning to want lighter, aerodynamic, and fuel-efficient vehicles. By 1982 GM added Saab and Hummer to the lines and in order to strengthen the reach and variety of vehicles sold worldwide. 1995 was the biggest year for General Motors as sales outside of North America exceeded 3 million units while sales in the United States hit 5 million units. “By the end of the 90’s, the foundation for global growth in the new millennium had been set” (GM.com).

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At the turn of the 21st century it was prevalent that the environment needed to be preserved. General Motors began creating vehicles that were more environment friendly. General Motors has innovated itself by creating fuel-efficient vehicles, bio fuels and hybrids. In 2003 General Motors partnered with Shell Hydrogen, a division of Shell Oil to hydrogen fuel cells and fueling infrastructure technology.