Gm Financial Report Analysis

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Introduction

General Motors Corp. (NYSE: GM), the world's largest automaker, has been the global industry sales leader for 76 years. General Motors was founded 1908, in Flint, Michigan and currently employs approximately 284,000 people around the world. GM's global headquarters is the Renaissance Center located in Detroit, Michigan, USA, They currently manufacture their cars and trucks in 35 different countries. Its European headquarters are based in Zurich, Switzerland, and its Holden headquarters are located in Melbourne, Victoria, Australia. In 2007, 9.37 million GM cars and trucks were produced globally under the following 12 brands: Buick, Cadillac, Chevrolet, GM Daewoo, GMC, Holden, Hummer, Opel, Pontiac, Saab, Saturn and Vauxhall. GM is also the majority shareholder in GM Daewoo Auto & Technology Co. of South Korea and has had much collaboration with the world's various automakers. This includes product, power train and purchasing collaborations with Suzuki Motor Corp. and Isuzu Motors Ltd. of Japan, advanced technology collaborations with Toyota Corporation and DaimlerChrysler AG and BMW AG of Germany and vehicle manufacturing ventures with several of the world's automakers including Toyota, Suzuki, Shanghai Automotive Industry Corp. of China, AvtoVAZ of Russia, Renault SA of France, and most recently, UzAvtosanoa of Uzbekistan. GM also had collaborations with Fiat S.P.A (see GM/Fiat Premium platform) and Ford Motor Company. To this day, GM retains various stakes in many different automakers.

GM parts and accessories are sold under GM Performance Parts, GM Good wrench and ACDelco brands through GM Service and Parts Operations which supplies GM dealerships and distributors worldwide. GM engines and transmissions are marketed through GM Power train. GM's largest national market is the United States, followed by China, Canada, the United Kingdom, and Germany. GM owns nearly-half (49%) of the finance company GMAC Financial Services, which offers automotive, residential and commercial financing and insurance. GM's On Star subsidiary is a vehicle safety, security and information service provider.

There have only been a limited number of models bearing the General Motors brand. The GM EV1 was an electric vehicle that was offered for lease only in the 1990s, before being unceremoniously scrapped. The Holden Statesman (1971 - 1985) was originally marketed as the General Motors statesman.

Alfred Sloan was picked to take charge of the corporation and led it to its post war global dominance. This unprecedented growth of GM would last through the late 70's and into the early 80's.

The General Motors Aftermarket Business in the US manages four brands; Good wrench, ACDelco, GM Performance Parts and GM Accessories. GM After sales operates globally.

Individual Analysis
GM
Liquidity Ratios
Liquidity is an important factor in financial statement analysis since an entity that can not meet its short term obligations may be forced into liquidation. The focus of this aspect of analysis is on working capital, or some computer of working capital.

Liquidity Ratios20072006200520042003
Current Ratio0.860.970.720.740.81
Quick Ratio0.941.572.622.962.63

Current Ratio is the measure of short-term liquidity. It indicates that the ability of an entity to meet its short-term debts from its current assets.

Quick Ratio is a more rigorous measure of short-term liquidity. It indicates the ability of the entity to meet unexpected demands form liquid current assets.

Leverage
Leverage20072006200520042003
gearing0.190.110.170.250.23
Profitability Ratios
Profitability Ratios20072006200520042003
Return on total assets0.0160.00780.00720.0190.021
Return on ordinary equity0.1540.0750.2260.2130.383

Return on total assets measures rate of return earned through operating total assets provided by both creditors and owners.

Return on ordinary equity measures rate of...
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