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Case Of Gm (Non Market Environment) Essay

1619 words - 7 pages

Question 1: Identify and explain the 4l’s based on the case.
a. Issues
The dispute over the safety of the pickup trucks, vehicle safety and defective design
Firstly, the root cause is that the GM company has a unreasonable design of their gas tank on the collisions GM C/K pickups, the report shows that this pickups’ gas tank was too close with the bumper, it only 25 centimeters long. This is dangerous because that will cause explosions if there is any strike. A safety design should be place the gas tank on the top of axle or add on a shield between the gas tank and bumper. Further, the report also shows that the gas tank design was used for trucks manufactured between 1979 and 1987, and ...view middle of the document...

As for the news media, we have the knowledge of the NBC versus GM, after the accident happened, there is a good story for the NBC, which is a highly critical Dateline story, and as the result, this story was aired nearly three months ago, therefore GM also expresses concerns to NBC about the fairness, they thought in this accident, their design was not the main cause of explosions, the deadly reason is the slammed by another car. But that’s obviously accepted by public.
From the data showed by NHTSA, besides GM, Ford or Dodge also have similar problem although they are using the different design, this case also impact to them for developing their safety standards.
In fact, day after GM press conference, NBC news made an embarrassing retraction not disputing GM’s facts. Last, NBC established the position of ombudsman for professional standards and program review, also the dateline senior and executive producers resigned, and Michelle Gillen was reassigned to Miami.

c. Institution
NHTSA (The National Highway Traffic Safety Administration)
The NHTSA recorded data shows that they do not control for how the vehicles were used, which could affect the frequency with which they were involved in accident. Once NHTSA has asked GM to recall the pickups because their gas tank design, but GM maintains they are safe refuse to recall the trucks.
The pickup owners were seeking to force GM to make the gas tanks less dangerous to compensate all pickup owners for either the cost of repairs or the resale value they lost because of the defect. But the fact is that GM hasn’t set aside any money to cover the cost of the program and doesn’t expect to take a special charge.
As we know about in 1999, finally the GM being sentenced to pay 1.9 billion as compensation for the 1993 accident, it is a success for judging their defective gas tank design, but still GM doesn’t recall their productions.
Finally, GM’s interpretation was that there was internal disagreement within NHTSA and/or lack of support from the department of Justice, and there are no recall but GM agreed to spend 51 million on safety programs including buying 200,000 child safety seats for low-income families.

d. Information
Superior information
GM has superior information about the crash test between 1981 and 1983. But that’s hidden until the GM engineer discourser those test.
The alternative choice for GM at that time may be admit that their defective design will cause the explosion if slammed, but they won’t, if GM admitted, means that they were make a big mistake and that is a life threatening problem, and lead to recall all of their pickups between 1981 and 1983, further, they would suffer a large amount of fund to correct it and make a settlement of claims, it’s unaccepted for the management of GM at that time.
Look back to NBC, they don’t have general information for the whole affairs, but come out the Dateline program, the presentations includes: human tragedy,...

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