Abstract
This study is an examination of the effects of the country where products are made on the willingness of consumers to buy General Motor automobiles in United States. In order to provide some suggestions to financially struggling GM and other US automobile companies, survey data were collected from a sample (n=311) of consumers from northern California. We examined how US consumers evaluate GM automobiles that are made in US, Canada, Mexico, Japan, China and Germany, with respect to their perceptions of product evaluations and purchase intentions. This study shows that ‘country image’ influences consumer willingness to purchase automobiles. It also shows a general consensus that Japan and Germany would be capable of delivering quality automobiles. Just as corporations have brand images, countries have brand images. A positive image is a valuable asset for a country. We propose that GM enter into contract manufacturing, outsourcing the entire production, with quality leaders of automobiles manufacturers. Our suggestions would allow GM to focus on improving its innovative capability and technology and developing drastic marketing strategy.
Highlights
After General Motors Corp. (GM) filed for Chapter 11 bankruptcy in 2009, it is on the way to recovery after paying back its loans of $8.1 billion the U.S and Canadian governments
We examined how US consumers evaluate GM automobiles that are made in US, Canada, Mexico, Japan, China and Germany, with respect to their perceptions of product evaluations and purchase intentions
The present study investigated country of origin (COO) effects, which refer to the extent to which consumers depend on the image of a country associated with the product to evaluate the quality of the product and make purchase decisions (Loo & Davies, 2006)
Summary
After General Motors Corp. (GM) filed for Chapter 11 bankruptcy in 2009, it is on the way to recovery after paying back its loans of $8.1 billion the U.S and Canadian governments. It is reported that GM kept its high production and high dealer incentives in order to generate cash for the health care benefits. It seems that this high-cost organizational structure has contributed to its unfavorable brand image and serious sales decline. The present study investigated country of origin (COO) effects, which refer to the extent to which consumers depend on the image of a country associated with the product to evaluate the quality of the product and make purchase decisions (Loo & Davies, 2006). We examined how US consumers evaluate GM automobiles made in US, Canada, Mexico, Japan, China and Germany, with respect to their perceptions of product evaluations and purchase intentions. We provide conclusion and discussion of this study
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