General Motors: A Century of Innovation and Leadership


1925 GM lineup

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1908 GM lineup

General Motors Corporation traces its history to September 16, 1908, when its colorful founder William C. (Billy) Durant incorporated the company with no fanfare. A high school dropout and born salesman, Durant had the revolutionary and visionary idea that several carmakers combined under one company umbrella would be more effective and have more growth potential than one brand on its own.

Billy Durant
Durant’s vision was dismissed at the time by most of the business and financial community. Yet by 1916, the General Motors family included the legendary Chevrolet, Oakland (later Pontiac), GMC, Oldsmobile, Buick, and Cadillac brands. Along the way, Durant also made two separate offers to acquire rival Ford Motor Company only to see the deals nixed at the last minute by Henry Ford himself. Ironically, by the time Durant left the company he had created, in 1920, General Motors was the booming auto industry’s only close rival to Henry Ford’s Ford Motor Company, which then dominated the American car market with its low-price, high-volume Model T.

Alfred Sloan
Under Durant’s successor, Alfred P. Sloan, Jr. (often called the father of modern management), GM soon adopted the equally revolutionary strategy of “a car for every purse and purpose.” Sloan divided the vehicle market into price segments ranging from low-price to luxury and targeted each of General Motors’ brands and models to a distinct segment, something no other manufacturer or marketer had ever done. This milestone innovation plus the equally unprecedented innovation of the annual model change enabled General Motors to become America’s number one seller of vehicles in 1926, a position the company still holds.

Harley Earl

Also in 1926, General Motors became the first automaker to establish a full-time, in-house design staff. The legendary Harley Earl, known as the father of automotive design, had been designing custom-built cars for Hollywood stars when Alfred Sloan convinced him to move to Detroit and join the growing GM team. Under Earl’s direction, GM set the trend for automotive design throughout the so-called “golden years” of design in the 1950s.

Boss Kettering
From the beginning, technological innovation was another core strategy for General Motors. In fact, it has been said that GM “wrote the book of automotive firsts,” going back to the early contributions of the legendary Charles “Boss” Kettering. Kettering invented the industry’s first workable electric starter in a barn near Dayton, Ohio, in 1911. After a demonstration of his landmark invention, Kettering’s self-starter was made standard on the 1912 Cadillac, which was advertised as “the car that has no crank.” Eliminating the dangerous and cumbersome hand-crank starter, Kettering’s self-starter is still considered the most important automotive innovation since the internal combustion engine.

1923 Duco paint
In 1920, Kettering established the General Motors Research Laboratories, also the auto industry’s first full-time in-house research center. Under his leadership, GM pioneered such milestone innovations as DUCO paint, which broadened the variety of colors that could be offered in automobiles, and the two-cycle diesel engine, which replaced the steam locomotive engine and revolutionized propulsion for the railroad industry.

Flint sit-down strike
In the 1930s, with the Great Depression, tensions in the work place spread across America, setting the stage for the historic GM “sit-down” strike in Flint, Michigan, which led to General Motors becoming the first company to recognize the United Automobile Workers of America (UAW). The UAW was soon the country’s largest union, and new health care and pension benefits first negotiated between the UAW and GM in 1950 became the norm for all American industry in the second half of the twentieth century.

War-time production poster
With America’s entry into World War II, no company converted faster or more comprehensively to wartime production than General Motors. It has been called the greatest industrial transformation in history, with more than 200 plants in North America shifting to production of airplanes, tanks, machine guns, and other military vehicles and goods in a matter of months. General Motors alone supplied the U.S. forces with more than $12 billion in military goods (several hundreds of billions when converted to today’s dollars), more than any other company. The late management theorist Peter Drucker went so far as to say, “General Motors won the war for America.”

1959 Cadillac Eldorado
After World War II, General Motors switched the focus back to production to cars and trucks for the American consumer with a new zeal. In doing so, it added a new passion to America’s so-called love affair with the automobile. Such milestone designs as the 1953 Chevrolet Corvette, 1955 Chevrolet Bel Air, 1959 Cadillac El Dorado, 1963 Buick Riviera, 1964 Pontiac GTO, 1970 Chevrolet Camaro, and dozens of others all set the benchmark for the competition in their market segments and have since become legends among car collectors and automotive historians alike.

Sloan decentralized operations org chart
As the company continued to evolve, its organizational structure and management also became the model for Corporate America. Alfred Sloan’s management concept of “decentralized operations with coordinated control” was copied not only by large and small corporations alike but government agencies and even non-profit organizations.

Dinah Shore
By the time of Sloan’s death in 1966, General Motors had become America’s largest advertiser and its largest private sector employer. It was also the icon of American manufacturing, innovation, and style. When television host Dinah Shore sang the famous jingle See the USA in Your Chevrolet, she struck a chord with every household in America.

GM HydroGen3 Concept
Today, General Motors, like all companies, faces new challenges on all fronts as competition becomes more global and technology and customer preferences change in the face of changing economic, environmental, and energy demands. Yet General Motors’ hundred-year heritage of innovation lives on, with current research and real-world applications focused on hybrid propulsion technology and alternative fuels such as ethanol and hydrogen fuel cells.

2011 Chevy Volt
In the spring of 2008, with U.S. gasoline prices reaching $4 a gallon, GM’s chief executive officer Rick Wagoner announced that the company’s board of directors had approved funding for production of the much-talked-about plug-in hybrid Chevy Volt. The Chevy Volt represents the most revolutionary advance in automotive propulsion technology since the invention of the automobile itself. It will use a common 110-volt household plug for charging its lithium-ion battery. For drivers traveling fewer than 40 miles a day, it will use zero gasoline and produce zero tailpipe emissions. For longer trips, its range-extending engine, using either gasoline of E85 ethanol, recharges the battery as the car travels and extends its driving range to around 360 miles before “plugging in” again. The first Volts are expected to be in dealers’ showrooms by the end of 2010.

GM is committed to offering top product quality, performance, and value to customers all around the globe while also playing a major role in reducing America’s dependence on hydrocarbon-based fuels and removing the automobile itself from the environmental equation. Innovation and change remain at the core of the company’s identity, just as they did in the day of Billy Durant and Alfred Sloan.

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