It might not seem like the time to contemplate GM’s gains against Toyota, but the book Why GM Matters: Inside the Race to Transform an American Icon, argues that GM has made surprising progress in ways that have largely escaped the daily headlines. Join the author, William J. Holstein on February 19 for the OPC Book Night. RSVP >>
The battle between General Motors and Toyota has been a lopsided one for more than two decades. The lumbering Detroit giant was surprised in the 1980s by Toyota’s superior manufacturing techniques. It was surprised again in the late 1990s by Toyota’s launch of the Prius hybrid auto, which solidly positioned the Japanese company as eco-friendly at a time when GM was perceived of as selling nothing other than gas-guzzling sport utility vehicles. Toyota made such rapid gains against GM that it eclipsed the American company for a while in 2007 as the world’s largest automotive company. Now GM has assembly plants, or plans for plants, in eight American states.
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Join us on Thursday, February 19 at 6 p.m. at Club Quarters, 40 West 45 Street, in Manhattan. RSVP >> |
It might not seem like the time to contemplate GM’s gains against Toyota, after all GM is receiving loans from the federal government just to survive the U.S. financial meltdown, and the incoming Obama administration will have to consider what it should do to keep GM alive. But a new book entitled Why GM Matters: Inside the Race to Transform an American Icon, argues that GM has made surprising progress in ways that have largely escaped the daily headlines. Author William J. Holstein, former president of the OPC and current president of the OPC Foundation, has covered the battle between GM and Toyota for more than two decades and will speak on the global competition between the two rivals.
“Not many people understand that GM has literally gone to school on Toyota to learn the lean manufacturing technique and it has succeeded in adapting it and improving on it in some cases,” says Holstein, who edited BusinessWeek’s first cover story on Toyota in 1985. “As a result, GM has nearly eliminated the quality and productivity gaps it has long suffered.”
If GM can survive 2009, its cost structure per vehicle will approach that of Toyota’s first plant in Georgetown, Kentucky. Even before GM and Chrysler agreed to undertake a new round of restructuring to qualify for continued federal assistance, GM Chief Executive Officer Rick Wagoner had reached agreements with the United Auto Workers that will strip $5,000 of the cost of each GM vehicle by 2010.
On other fronts, GM is battling neck and neck with Toyota to introduce the first electric vehicles powered by lithium ion batteries. GM is scheduled to launch its Chevrolet Volt in late 2010; Toyota has just announced that it will rush its own lithium ion battery car to market before then. But in sharp contrast with the nickel metal hybrid-powered Prius, GM will at least be competing on the same field of battle, Holstein argues, rather than completely abdicating.
Toyota itself is suffering its first loss in decades and has signaled that it has excess capacity in the United States. Its quality has suffered and it has just shaken up his executive suites by moving a member of the Toyoda family into the job of president.
“Until very recently, most people assumed that Toyota would simply blow GM out of the water,” says Holstein. “But GM is fighting back against big odds. I think it’s going to surprise some of its many critics.”