The World's Most Innovative Companies 2018
Launched in 1908, General Motors was once the paragon of American corporate might. Its brands are household names (Chevrolet, Cadillac, Buick, and more) that belong in any litany of U.S. icons. In the 1970s, the gas crisis and the incursion of foreign brands like Toyota and Honda broke the hold GM, Ford, and Chrysler had on domestic car buyers. GM failed to heed the wake-up call. Arrogant leadership emphasized branding and marketing over automotive quality. They failed to address GM’s bloated bureaucracy. Innovation dwindled. Finally, in 2008 GM was forced into bankruptcy, and the U.S. federal government had to bail out the company. Another massive crisis arrived in early 2014 when its new CEO, Mary Barra, announced that GM would recall hundreds of thousands of Chevy Cobalts because of a faulty ignition switch. It would eventually recall 2.6 million vehicles. The switch has now been implicated in 139 fatalities, and GM has agreed to pay out nearly $1 billion to settle claims.
Despite the crises, General Motors has been clawing its way back to relevance. It has restructured, and is a somewhat leaner company than before bankruptcy (it still has 220,000 employees.) The quality of its cars is high once again, and the culture is changing. Barra uses the ignition switch crisis as constant reminder of what happens when safety is not prioritized. She has also acknowledged that the car business is about to change completely. Instead of buying a car, people (especially in cities) are likely to hail a car from an autonomous fleet of electric cars. Under Barra, GM has built, partnered, and acquired everything it needs to be a significant player in such a vision of the future of transportation. It’s a huge opportunity for GM, which gets its profits from the sales of trucks and SUVs to rural and suburban buyers.
General Motors has a plan to build, scale, and put to work a fleet of autonomous cars. In 2017 GM moved forward with a manufacturing-scalable electric autonomous Chevrolet Bolt developed in collaboration with Cruise Automation, a self-driving car startup it acquired in 2016. The company is exploring deployment of these vehicles not only through traditional sales but through a managed fleet of on-demand vehicles. In 2016, GM launched Maven, a car rental program in which drivers can lease by the hour through an app. That program has since expanded to 17 cities and sprung a gig economy version that allows ride hail and delivery drivers to borrow cars starting at $189 per week. Maven Gig is currently available in Los Angeles, San Francisco, San Diego, Phoenix, Detroit, Baltimore, Washington, D.C., and Boston. In addition to its own network, General Motors is working with Lyft to test out its technology among consumers. No public trials have started yet. The company plans to bring its self-driving cars to big city streets by 2019.