GENERAL MOTORS www.GM.com Facts: . 1908: Founded . 1982: Built huge factory in Spain . 2009: Files for bankruptcy . 2010: Emerges from bankruptcy . 2013: Over 200,000 employees In some respects, General Motors (GM) is the story of globaliza- tion. It was one of the most successful companies in the world in the 1960s under the gifted manager Alfred Sloan. As it expanded globally, some of the jobs that had gone to Americans were moved overseas, partly to be closer to where vehicles were sold but also to cut costs. Labor costs were much lower in other countries. Gasoline prices increased sharply during the 1970s and many Americans turned away from GM products and bought cars from Toyota, Honda, or Nissan. Americans were interested in the smaller, high-quality cars built by the Japanese. The weakened state of GM and the financial crisis of 2008-2010 forced the company to file for bankruptcy in 2009 when the U.S. government stepped in to help. But the company has since recovered. Ben James received a bachelor's degree in statistics and a master's degree in business admin- istration. He has worked at GM for several years. Among other things, he studies data such as that shown in the following two figures and develops equations to forecast demand. New Vehicle Sales In United States U.S. Automobile Market Share 25 by Company June 2009 Hyundai 20 5% All others General Motors 15 16% 18% New Vehicle Sales (in millions of vehicles) 10 Nissan Ford 8% 16% Honda 10% Toyota 1990 1994 1998 2002 2006 2010 Chrysler 15% Year 12% DATA: Bureau of Transportation Statistics. 1. What can you learn from the two figures? 2. Many factors are involved in making a forecast. To illustrate, use the following equation to 2. make a monthly forecast of car sales (in thousands) in one area given Advertising = $6.2 (millions), Economic Growth = 2.8% (.028), and Level of Competition = 6. (See Section 4.2, Examples 1-8.) Sales = 34.8 + 5.3 . Advertising + 485 . Economic Growth - 34.2 - Level of Competition