ABSTRACT
The rise and fall of General Motors (GM) is an epic story in American economic history that is especially noteworthy for understanding the economics of both firms and markets. The data shows that the market share of the firm declined in the years after its formation. Sloan identified four changes in the automobile market that proved on net beneficial to GMs business strategy, organizational design, and long-term superior performance. The data show GM's market share compared to the domestic market share of Ford, Chrysler, and all other domestic producers. To gain some perspective on both GM's sustained dominance and its comparative decline in the last twenty-five years, some background on the nature of manufacturing is in order. During World War I and the Korean conflict, GM provided considerable manufacturing support for the military operations, but those activities were secondary to the market-driven, profit-making business operations of the firm.
