General Motors Corporation

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This article is part of the Center for Media & Democracy's spotlight on global corporations.

General Motors
Founded 1956
Industry Automobile
Products Cars & Trucks
Parent General Motors
Divisions General Motors Colmotores, S.A. ^ GM Europe
Subsidiaries Buick, Cadillac, Chevrolet, GM Daewoo, GMC, Holden, Hummer, Opel, Pontiac, Saab, Saturn and Vauxhall.
Website http://www.gm.com/
http://www.chevrolet.com.co

General Motors Corporation was founded in 1908 and remains headquartered at the place of its establishment in Detroit, Michigan.

Ties to the American Legislative Exchange Council

General Motors is a corporate funder of the American Legislative Exchange Council (ALEC).[1][2] It is a member of ALEC's Commerce, Insurance and Economic Development Task Force[3] and its Energy, Environment and Agriculture Task Force.[4] See ALEC Corporations for more.

About ALEC
ALEC is a corporate bill mill. It is not just a lobby or a front group; it is much more powerful than that. Through ALEC, corporations hand state legislators their wishlists to benefit their bottom line. Corporations fund almost all of ALEC's operations. They pay for a seat on ALEC task forces where corporate lobbyists and special interest reps vote with elected officials to approve “model” bills. Learn more at the Center for Media and Democracy's ALECexposed.org, and check out breaking news on our PRWatch.org site.


History

In 1921, after a period of declining sales, GM set out to bring down its major competition: electric streetcars. By using the business its automotive transportation brought to freight carriers as leverage, GM pressured railways like Southern Pacific and New York Central to abandon their electric lines. Electric lines were replaced by the omnibus, the inferiority of which drove people who had previously frequented electric lines to buy cars. GM was more than happy to fulfill their newly-found need.

The Oil Crisis of the 1970s saw GMs profit margins shrink drastically again after nearly 50 years at the top of the automotive industry. GM consequentially cut thousands of jobs, shutting down plants across the country. The infamous plant closings in Flint, MI, where 30,000 auto workers lost their jobs in the same town, were documented and made into a symbol of the company's early downsizing by Michael Moore's 1989 documentary Roger & Me.

As of June 2005, General Motors has announced that it is going to cut a total of 30,000 jobs and an unspecified number of plants over the course of 2005, according to several news outlets.

History of GM Colmotores S.A.

GM Colmotores, S.A. is a car company based in Bogota, Colombia. They are under license to manufacture a variety of GM, Daewoo, Isuzu and Suzuki vehicles in the local market, under the Chevrolet name.

On July 27, 1956, the Colombian Automotive Factory S.A., Colmotores, was founded. One month later, it was written into the constitution and on August 25th, it started with an initial capital of 5 million pesos to support various regions of Colombia especially Antioquia, Cundinamarca, Caldas and the coast. Manufacturing began under the presidency of Santiago Trujillo and the general management of Germán Montoya and construction ended in 1961. The company entered into negotiations with the British Motor Corporation to assemble Austin vehicles in Colombia.

The Colmotores plant was inaugurated in February 1962 by Dr. Alberto Lleras Camargo, the President of the Republic, and the Assistant Bishop of Bogota, Emilio de Brigard, blessed the workers and the installations. Within four years, Colmotores had produced 4000 vehicles.

In 1965, Chrysler International had acquired 60 percent of the actions by Colmotores and the company’s name changed to Chrysler Colmotores. The following year, the manufacturing and sale of Dodge cars began, and the first Colombian produced automobile was the Coronet 440 and the Dodge trucks from 1 to 7 tons. The following year, began assembly of Simca vehicles. Chrysler’s control over Colmotores lasted until 1972 with the gas crisis and then in 1979, Colmotors was acquired by General Motors. GM changed Colmotor’s name to General Motors Colmotores, S.A. in 1981.

Buying positive media coverage

Fake TV news

In the Center for Media and Democracy's April 2006 expose of video news releases (VNRs), titled "Fake TV News: Widespread and Undisclosed," three of the 36 VNRs tracked were funded by and scripted for General Motors. All three were produced by the broadcast PR firm Medialink Worldwide. [1]

One VNR, from January 2006, celebrated GM's corporate headquarters, the Renaissance Center, as key to the revitalization of downtown Detroit. [2] Another VNR, from March 2006, falsely claimed that GM had launched the first auto manufacturer web site in 1996. [3] The third VNR, from the same month, touted the benefits of becoming an auto technician, a likely response to industry staffing and image problems. [4]

CMD's November 2006 report, "Still Not the News: Stations Overwhelmingly Fail to Disclose VNRs," identified several more GM-funded VNRs released via Medialink. Five of the 33 VNRs described in the report came from General Motors: [5]

Buying off journalism students

"Maybe I’m just a bit jaded, but I have a problem with this solicitation," wrote University of North Carolina business journalism professor Chris Roush. On a UNC journalism blog, he posted an email that he received on August 30, 2006, "from a public relations person at General Motors ... asking me to send student journalists to an event that the company will be holding in Las Vegas next month." He added, "It seems what young student journalists would be 'learning' from this experience is how to take a free trip and meals from one of the company’s largest corporations." [5]

The email, from GM's western region PR staffer Diedra Wylie, describes "General Motors’ First College Journalists Event taking place in Las Vegas, NV on September 9-10th." She added, "While in Las Vegas the college journalists will have the opportunity to meet with professional journalists and GM executives who’ll be in attendance. GM will pay for travel, hotel and meals for students that attend." [6]

GM's Andrea Canabal, who organized the event with Wylie, told PR Week, "I would hope [the students'] opinion wouldn't be swayed by a free trip." According to Canabal, the auto maker "approached the faculty advisors of the college papers first, asking them if it was okay to pitch the trip to the students." She said that "ten schools, including Duke, Penn, Purdue, Washington, and Missouri had signed off on the proposal." [7]

Advertorials

GM CEO Rick Wagoner told attendees of the 2007 Newspaper Association of America conference, "One area where we're beginning to do more, and will want to work with newspapers to explore new options in, is advertorials." Advertorials are ads written as though they are independent op/ed columns. Wagoner said that GM was putting less money towards traditional print ads in part because the company no longer offers a "deal of the month." [8]

GM is also interested in overseas promotion. "Some of you own foreign-language newspapers that may have links to papers in other countries," explained Wagoner. "Hispanic papers with links to South America or the Caribbean, for example. Others, I'm sure, have business or editorial connections with foreign newspapers that we at GM probably have no idea about." [9]

Environmental controversies

"GMnext" and greenwashing

In January 2008, General Motors launched a new website, "GMnext" (which includes a wiki), to mark its 100th anniversary and showcase "ideas on future automotive technologies," reported the Financial Times. Instead, environmental activists posted critiques of the company. GM called the posts on climate change and other issues "diatribes loaded with propaganda," and shut down the interactive part of the site. "We weren't going to lose control of our own site," explained the automaker. Instead, GM's Brent Dewar answered pre-submitted questions on greenwashing during an online chat on February 6, 2008. [6]

Rainforest Action Network slammed Dewar for "the large number of questions he ignored and the indirect responses he gave to the most pointed inquiries." Marketing professor Clay Voorhees saw GM's efforts as "part of a new push for authenticity by companies," reported Detroit News. [7] Over the past year, GM has also "invited dozens of bloggers to car shows across the U.S., setting up face-to-face interviews with senior executives." [6]

Global warming "a crock"

In January 2008, GM executive Bob Lutz (who's appeared in the company's video news releases [8]) told reporters in a closed-door meeting that global warming is "a total crock of shit." "Within hours the remark was reported on the internet, and spread, as Lutz subsequently lamented, 'like ragweed,'" reported Green Left. [9]

Lutz "had earlier derided efforts to force car companies to build smaller, more fuel-efficient vehicles. Such attempts, he wrote on GM's blog, were 'like trying to address the obesity problem ... by forcing clothing manufacturers to sell smaller, tighter sizes.'" [9]

Other Lutz quotes regarding environmental issues include criticisms of raising fuel efficiency standards: [10]

"CAFE is a totally flawed strategy ... It has never worked and it never will. ... If I were dictator of America, I would gradually raise the price of gasoline by 25 cents every six months or so, until it's more in line with gas prices in the rest of the world."

Lutz also accused the American Petroleum Institute "of running a multi-million dollar smear campaign against ethanol," reported BusinessWeek: [10]

"They make it sound like ethanol is taking food out of the mouths of babes. According to them, we're going to have taco riots in Mexico because of ethanol." Lutz did admit that the net energy benefits of corn-based ethanol are "not what we would like to see" and pointed to the development of next-generation cellulosic ethanol as a necessary step.

Political contributions

General Motors gave $626,330 to federal candidates in the 05/06 election cycle through its political action committee (PAC) - 26% went to Democrats and 74% went to Republicans. [11]

GM was among various companies that gave record amounts in political contributions four years after passage of a law that tried to reduce the impact of corporate money in U.S. politics. Bloomberg said, "The companies are working around the law, which banned unlimited contributions to parties, by giving more money through their political action committees than ever before in the first year of an election cycle, and writing checks to loosely regulated independent groups, financial disclosures show." [12]

Lobbying

GM spent $8,805,000 on lobbying in 2006. $3,965,000 of this total went to over 20 outside lobbying firms. [13]

The following is a list of lobbyist and PR groups which currently list General Motors among their clients.

Public relations

In February 2009, the Detroit News reported that GM had hired Democratic Party political consultant Michael Whouley, who also does corporate PR at the Dewey Square Group PR firm. "Whouley's addition comes as even some of the companies' allies in Washington have raised questions about GM's political and public relations strategy. ... Last week, when GM CEO Rick Wagoner met with members of Congress, he did not mention that the company would ask for up to $16.6 billion in new federal aid, according to several sources familiar with the discussions. The size of the request surprised even some of the company's staunchest defenders. ... Whouley is widely considered to be one of the Democratic Party's best organizers of grass-roots campaigns, focusing on building field organizations and get-out-the-vote operations for election campaigns. His hiring is likely a signal that GM wants to increase efforts outside Washington to build political support." [14]

"GM's environmental push, which is handled by Manning, Selvage & Lee, has been gaining major traction," reported O'Dwyer's PR Daily in January 2008. "More than half of respondents (51 percent) say their perception of GM is more positive than a year ago. Thirty-five percent of those people credit the automaker’s environmental commitment as the reason for their better opinion of GM." [15]

On January 13, 2008, GM's Rick Wagoner announced his company's partnership with Coskata Inc., "to produce ethanol from various renewable sources, such as garbage, old tires, and plant waste." Wagoner "hailed Coskata's proprietary process that promises to produce ethanol for less than $1 a gallon." [15]

Personnel

Key GM executives and 2006 pay: [16]

[17]

Selected GM board members: [18]

Financial information

Ticker Symbol: Main Exchanges: Investor Website: NYSE Symbol:

  • GM - GM common stock
  • GMH - Class H common stock

Contact information

300 Renaissance Center
Detroit, MI 48265
Phone: (313) 556-5000
Fax: (313) 556-5108
Web: http://www.gm.com

GM Colmotores, S.A.
Tel: +57-1-424-9393
Toll-free: 01-8000-124-389

Articles and resources

Related SourceWatch articles

References

  1. Defenders of Wildlife, Natural Resources Defense Council, "Corporations and Trades Associations that Fund ALEC," Corporate America's Trojan Horse in the States: The Untold Story Behind the American Legislative Exchange Council, online report, 2003
  2. Clearinghouse on Environmental Advocacy and Research, project of the Environmental Working Group, Information on American Legislative Exchange Council, archived organizational profile, archived by Wayback Machine December 2, 2000, accessed August 19, 2011
  3. American Legislative Exchange Council, Commerce, Insurance & Economic Development Task Force Meeting Agenda, August 3, 2011, on file with CMD
  4. American Legislative Exchange Council, Committee Roster, organizational task force directory, June 30, 2011, document obtained and released by Common Cause
  5. Diane Farsetta and Daniel Price, "Still Not the News: Stations Overwhelmingly Fail to Disclose VNRs," Center for Media and Democracy, November 14, 2006.
  6. 6.0 6.1 Bernard Simon, "GM invites green critics to join online debate," Financial Times, February 6, 2008.
  7. David Shepardson, "GM addresses energy activists: New Web site tackles environmental issues, but bloggers use forum to attack automaker," The Detroit News (Michigan), February 7, 2008.
  8. Diane Farsetta and Daniel Price, "Would You Buy a Car From This Man? KMSP-9 Helps Rev Up Convertible Sales," from the report "Still Not the News: Stations Overwhelmingly Fail to Disclose VNRs," Center for Media and Democracy, November 14, 2006.
  9. 9.0 9.1 Renfrey Clarke, "Corporations and climate change," Green Left (Australia), March 29, 2008.
  10. 10.0 10.1 Bradley Berman, "Bob Lutz, the Chevy Volt and the Easter Bunny: GM's Lutz says that the feasibility of the plug-in hybrid technology will be proven by next Easter and rivals will have egg on their face," BusinessWeek, November 19, 2007.
  11. 2006 PAC Summary Data, Open Secrets.
  12. Jonathan D. Salant, "GM, Comcast, Pfizer Boost Political Giving, Skirt Federal Ban", Bloomberg, February, 21, 2006.
  13. General Motors lobbying expenses, Open Secrets.
  14. Gordon Trowbridge and David Shepardson, "GM hires veteran political consultant: Michael Whouley, a Democratic Party organizer, is expected to rally for public support for automaker," The Detroit News (Michigan), February 20, 2009.
  15. 15.0 15.1 "FAMA Promotes GM's Ethanol Partner," O'Dwyer's PR Daily (sub req'd), January 14, 2008.
  16. General Motors Key Executives, Yahoo Finance, accessed August 2007.
  17. Leadership, General Motors, accessed August 2007.
  18. Board of Directors, General Motors, accessed August 2007.

External resources

External articles