General Motors Versus Toyota

General Motors vs. Toyota

General Motors, a European car company, and Toyota, a Japanese car company, are competing for worldwide supremacy in the manufacture of automobiles. However, as with any competition, are factors that make one superior from the other. And in the case of General Motors and Toyota, if I were an investor, I will choose to invest with Toyota. Following is a discussion on why it is more ideal to invest in Toyota than in General Motors during these days.

The first thing that investors usually consider when trying to invest in a particular business is the marketability of a company's products and how those products do in the international market. This is important because it is the products' ability to fit in the diverse consumer markets where the success of a company lies. As with General Motors and Toyota, the latter currently fulfills this strategy. This is indicated by several events that demonstrate the success of Toyota. One of the significant events is the announcement in recent news that Toyota is now the no. 2 largest automaker in the world, overtaking Ford Motor Co. (Tierney, et.al, 2005).

The second thing that investors usually consider is the ability of a company to please the consumers' needs such as by providing sufficient goods that they need. As with Toyota, the company is continuously establishing automobile factories all over the world. This allows them to provide the automobile needs of consumers in a quick response, without the need to import and export from other factories in other location. Comparing General Motors and Toyota, the latter seems to do well on this strategy. Two simultaneous events that show the opposing capability of these companies was when Toyota established a new factory in Tijuana, Mexico, while the other company on the other hand is permanently halting its factory operation in Linden,

New Jersey.

The third important factor for investors is the ability of a company to maintain its income, and therefore the company's existence and stability. Since investing is all about money and stability, these are factors that Toyota does not overlook. Toyota may have started as a low-ranking automobile company than General Motors, but in time, the company shows its continuous ability to achieve success, thus overcoming other automobile companies. The objective that gives the company its success: making better cars and lowering costs (Tierney, Garsten). Even General Motors was not able to compete with this strategy of Toyota. When Toyota equipped their cars with fourth-generation hybrid technology, General Motors teamed up with DaimlerChrysler (Tierney, et.al., 2005) to catch up with Toyota's lead. Toyota is indeed doing well in its business endeavors. The following page shows a chart indicating the company's continuous success in terms of income and stability factors, as extracted from Tierney and Garsten's article Toyota, GM Locked in Fight for Worldwide Supremacy.