Here’s a nice piece from The Week describing how GM slid from industry dominance to near bankruptcy. One early success was appealing to every segment of the market.
Chevrolet, said a GM executive, was “for the hoi polloi, Pontiac for the poor but proud, Oldsmobile for the comfortable but discreet, Buick for the striving, and Cadillac for the rich.” GM also produced many of the innovations that would come to define the modern automobile, including power steering and power brakes, independent suspension, and automatic transmission. And significantly, GM was the first auto company to change its cars’ features and styling almost annually—instilling in Americans the habit of replacing their cars every few years. With GM factories turning out cars in virtually every price range, sales soared, and by the 1950s, more than half the vehicles on America’s roads were GM-made.
The unions played a significant role in the eventual downfall.
The unions were slow to moderate their demands in response to competitive challenges. They resisted the closure of unneeded factories and pressured GM to create a “jobs bank” that paid laid-off workers up to 95 percent of their salary and benefits. But you can’t blame the workers for management’s arrogance and complacency. Finance executive Nancy Rottering, who quit in frustration in 1987, said the attitude at headquarters was, “We’re GM. We know everything, we don’t need to change.” Executives were literally walled off from the rest of the company behind the double electronic doors to the 14th floor of GM’s Detroit headquarters. They entered the building through a private basement garage and took their gourmet meals in private dining rooms. They rarely interacted with customers or even their own dealers, who knew firsthand their customers’ likes and dislikes.
The entire story is interesting, and unfortunate.