Business Case Studies, Leadership Case Study, Tata Group,Ratan Tata

Code : COM0102

Year : 2005

Industry : Automobiles

Region : Europe

Teaching Note: Not Available

Structured Assignment : Not Available

Abstract: General Motors Europe (GME), the European division of the world's largest automobile manufacturer General Motors, started reporting protracted losses and declining market share from 1999 due to the weak European market. New liberalised car dealership rules, an unsuccessful restructuring plan, a failed alliance with Fiat Auto and the growing dominance of the Asian carmakers further worsened the situation. GME's position slid from second to fifth in the European market. In 2004, to save the ailing European division from further decline, its new chairman Frederick Henderson, formulated a restructuring plan focusing on reduction of costs, plant capacities, downsizing and integration of functional departments. But according to the industry analysts the task of restructuring is likely to be tough and the layoffs expensive, with weak markets for the next two years.