The General Motors-Toyota Joint Venture: A General Motors Perspective

• DOI: 10.1177/0003603X9904400404
• Date: 01 December 1999
• Published date: 01 December 1999
• Author: Mark Hogan
• Subject Matter: Article

The Antitrust BulietinlWinter 1999

The

General

Motors-Toyota

joint

venture: a

General

Motors

perspective

BY MARK HOGAN*

821

I. Why do businesses do such alliances or

joint

ventures?

I'm

certainly comfortable talking about strategic alliances because

it is a way

of

doing

business

today for

GM,

our

industry

and

really all industries. Today

I'd

like to talk

about

why we enter

these strategic alliances and

how

we organized them.

We believe we have strategic alliances with many of

our

sup-

pliers, customers and competitors. While it is often difficult to tell

the difference among those three classes, Iwill concentrate today

*

President,

e-GM and

Group

Vice

President,

General Motors

Corporation.

AUTHOR'S NOTE: This article is based on my presentation at the ABA

Antitrust Section Spring Meeting in Washington D.C. program Strategic

Alliances, Ancillary Restraints, and the Rule of Reason: From Addyston

Pipe to the Here and Now, April 2, 1998. It was prepared with the assis-

tance

of

Steven Cernak, Attorney, General Motors Corporation Legal

Department.

© 2000 by Federal Legal Publications, Inc.

822

The antitrust bulletin

on alliances with competitors because Ithink it is the most inter-

esting for this audience.

Just

aquick

look

at

the

popular

business

press and

books

shows that the nature of competition has changed. You

don't

have

to look at too many issues of the Wall Street Journal to see exam-

ples of cooperation and alliances among

competitors-computer

industry, film for cameras, etc.

Or

just

look at some of the popular titles in the business sec-

tion of your local bookstore: Death

of

Competition, Co-opetition.'

Just those titles alone should have antitrust lawyers nervous (or

excited about filing new cases). And our own industry does strate-

gic alliances in a big way. Every year, Ward's Communications

puts out a new map of the world. On this map are listed all the

major vehicle manufacturers around the world. A line connects all

those manufacturers that have some sort

of

relationship. There are

so many lines that

the

chart

is popularly known as the

spider

chart.2

But

why? Why are hard-bitten competitors acting in this way?

Well, some of those popular business books put it in a couple of

different ways. Co-opetition describes business as not war, not

peace, but this something in between it calls co-opetition in which

competitors cooperate to increase the size

of

the pie and compete

to divide it. In Death

of

Competition, the author simply says that

no one business can do it all alone. My own thoughts are exactly

that: GM, as big as it is, simply

can't

do everything we want to do

alone. We are neither big enough nor smart enough.

So what is it that we are doing together that we

can't

do as

well alone? Here are some GM examples:

reaching some places that we

can't

reach

alone-our

Delphi parts-

making unit has

joint

ventures around the world, we have vehicle

production

joint

ventures in Russia and elsewhere

JAMES

F.

MOORE,

THE

DEATH

OF COMPETITION (1996);

ADAM

M.

BRANDENBURGER &BARRY NALEBUFF, CO-OPETITION (1996).

A"spider chart" appears at the beginning

of

this symposium issue.