02 May 2011

The Uncertainty In GM Car Making

I must be a cautious person by nature. I don't just read something and swallow it. Recently the BBC quoted GM Europe chairman "The future of car making in the UK could be in danger if the industry fails to develop a British-based supply chain." It was a strong statement but something does not seem right about it. Nissan, Toyota and Honda all make cars in the UK and never talk of pulling out. They have all made long term commitments to UK manufacturing. So why is GM coming out with this sort of talk?

Let us look at some facts about UK car making. Nissan and Honda - make three models each, Toyota - two models, GM - one; the Astra. It seems that GM don't really want to be there with only one token model. Profitabiltiy is improved with more models too.

None of the Japanese brands talk of pulling out of UK but GM is always suggesting any current model could well be the last made at Ellesmere Port, UK. The Japanese brands make long term plans and thereby promote security, GM talks up reasons to leave, promoting uncertainty. If GM want suppliers to invest, maybe GM itself should reassure them of its long term plans to stay.

What I have learned: That Japanese companies show loyalty to their workers and promote stable car production. GM has a cynical attitude of creating uncertainty as the best way to run their business. I cannot say I admire GM policies and their inability to make money in Europe is because of the way they do things.

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