Ford vs. General Motors: A Deep Dive into America’s Automotive Giants

Ford vs. General Motors: A Deep Dive into America’s Automotive Giants

Category: Business Rivalries

Ford vs. General Motors: America's Automotive Giants | Mr. Business Magazine

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When it comes to buying a car in terms of durability, reliability, classic look, design, and technology, two names hit first – Ford and General Motors. At first glance, you may get confused by seeing similarities in the business models of these automobile manufacturing companies. But as you dive deeper, you will find the similarities and the key differences between the two companies.

In this article, you will learn about the rivalries between the two companies, Ford vs. General Motors, and find which one of them is better for you.

Ford vs. General Motors: History

To understand the debate between Ford vs. General Motors, you must first look into the history.

History of Ford

The Ford Motor Company began in 1903 with Henry Ford’s mission of making a car that was affordable to every middle-class family. It was his third attempt at establishing an automobile business. At the time, the company could only produce a few cars a day.

Ford vs. General Motors: America's Automotive Giants | Mr. Business Magazine

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The breakthrough period for Ford Automobiles came when Henry introduced the T-shaped car in 1908. This car embodied all the features that Henry wanted: efficiency, reliability, and a reasonable price. In a short period, the demand for the car increased. Ford Motor Company commissioned a new factory in Highland Park, Michigan to meet the customer’s demand. Albert Kahn designed the factory. Individual workers stayed in one place and performed the task on vehicles in front of them. This implementation gave Ford an edge to beat competitors.

In 1914, Ford boosted the wage of each factory worker by $5, helping many to enter the world of middle-class families and buy cars. In 1920, Ford Motor Company purchased the Lincoln motor vehicle and moved its production operation to the Ford Rouge Complex in Dearborn, Michigan.

Ford took some brilliant steps in introducing the most iconic vehicles in the marketplace: the Thunderbird in 1955 and the Mustang in 1964. In this period, the company also faced the challenge of the unfortunate demise of the car Edsel, which never caught on with the public. Throughout the next several decades, Ford Motor Company continued to expand, opening operations in Asia, founding the Motor Credit Company, and acquiring other brands, including Mazda and Land Rover. In terms of achievement, Ford is one of three American automakers that avoided bankruptcy and bailouts. Continued to the path of success, today Ford is one of the largest car-producing companies in the world.

History of General Motors

Ford vs. General Motors: America's Automotive Giants | Mr. Business Magazine

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William C. Durant started General Motors in 1908 to manage Buick, a premium automobile brand. Within two years, he added other car companies like Oldsmobile, Cadillac, and Pontiac. In 1910 due to high debt, Durant faced lots of challenges and lost control over General Motors. Just a year later in 1911, he made a strong comeback after starting Chevrolet. In 1916, after a stock buyback campaign, he again took control of General Motors.

Unfortunately, in 1920 after another bank buyout, Durant’s leadership came to an end. Alfred P. Sloan took over the control of General Motors and moved its headquarters from Flint, Michigan to a newly built General Motors building in Detroit. For the next three decades, General Motors maintained its world leadership in revenue and market share.

In 1980, under the leadership of Roger B. Smith, General Motors began to experience a decline. Foreign automakers, led by Toyota and Honda, captured the market share of General Motors affecting the consumer’s demand. Jack Smith recovered it in the 1990s by cutting costs and eliminating some product lines.

In 2009, General Motors went bankrupt and got a government bailout, saving many jobs. In 2013, the government sold its shares, and a year later in 2014, Marry Barra became the first female CEO and later became chairman in 2016. Today, General Motors is pushing its limits to develop zero-emission motors to save the environment and grow globally.

Ford vs. General Motors: Challenges

The debate Ford vs. General Motors is incomplete without the challenges.

Challenges Faced by Ford

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Sustainability: The current cars of Ford are not as efficient or environment friendly as they could be. Ford lags behind Toyota in hybrid technology and General Motors in larger hybrid vehicles. Today, the company needs more alternative energy models in various vehicle classes to become a leader in environmental sustainability.

Economic and Financial Struggles: Global economic markets are performing worse than Ford anticipated. This has lowered the confidence of new people to make big purchases. Government incentives have helped, but they are not long-term solutions.

Low Market Share: In domestic market share, Ford is fourth in global sales behind Toyota, General Motors, and Volkswagen. It has only a 2% share in South Asia African markets like China and India.

Challenges Faced by General Motors

Declining Car Sales: Car Sales have dropped in the major trade part of the US and China. People are buying fewer small and mid-size cars. This makes it hard for General Motors to stay competitive and profitable.

Factory Production Issues: Some factories of General Motors in Lordstown, Ohio are running at low capacity. As a result, it makes each car more expensive to produce keeping the factories open.

Adapting to Market Changes: General Motors should work to change the models, design, and technology in their car models to meet the customer’s demand. They should invest in light trucks, electric, and self-driving cars to stay in the market.

Ford vs. General Motors: Comparison

To understand the difference between Ford vs. General Motors you need to understand them in various aspects.

Aspect Ford General Motors

Major Brands Globally known for Ford, Mustang, and Lincoln Owns Chevrolet, Cadillac, and Buick

Market Presence Strong in North America, and expanding globally Strong in China, and emerging markets

Key Products F-Series trucks, Mustangs, and EVs Chevrolet trucks, SUVs, and EVs

Technological Innovations Investing in electric vehicles Developing EVs and autonomous vehicles

Cultural Impact The iconic American brand with cultural symbols like Mustang Diverse cultural impact through brands like Chevrolet and Cadillac

Ford vs. General Motors: Which One Is Better?

Based on the Quality score, you can go with General Motors. Ford Motors has a quality score of 39, which is weak, and general motors of 64, which is strong. However, this is just an analytics ultimately deciding which is better between Ford and General Motors comes down to your priorities. The comparison of Ford vs. General Motors – is like choosing reliability and durability versus autonomous driving and technology.