Automakers provide an interesting study in cost management strategies. General Motors often provides a contrast to other U.S. manufacturers. For example, Chrysler and Ford opted to outsource many product components, but GM continues to manufacture a much higher percentage of the parts needed to produce its cars. One of the variables driving GM's strategy is its high level of unionization. The unions have resisted attempts made by GM to restructure operations and outsource more components.
a. From the perspective of price-based competition, why would GM want the flexibility to outsource more of its parts and components?
b. From the perspective of managing quality, how could outsourcing positively or negatively affect GM's ability to manage quality relative to its competitors?
c. What ethical responsibility does GM bear to the union in seeking to restructure and outsource more of its parts manufacturing?
d. In restructuring its operations following its 2009 bankruptcy, how did GM's unions influence the restructuring?