Unit 6 Discussion - Essay Example

General Motors Investment Management College General Motors is an American company that specializes in motor vehicle production. It had financial problems in the past and was on the brink of collapse. However, the company was saved from bankruptcy by the U.S government, which now owns a significant amount of shares in the company. The company predicted the upcoming cash flows, which would depend mostly on the Ford cars that they produce in large numbers. Americans have a soft spot for the Ford brand.

However, according to John Rosevear, a financial analyst, the company needs to invest more in the production of Cadillac, a car the popularity of which has dropped significantly in the recent years. He compares General Motors to Volkswagen, the company which increased their investment in Audi and received a significant increase in their revenue (Rosevear, 2012). This is the best route for GM to take if it plans to reestablish itself amongst the world’s elite companies.Production of Cadillac may be a lucrative investment but the company already has made some other important investments that can be successful in the nearest future.

This is a major challenge to the investment manager since he cannot stop an investment that is already earning the company millions. The investment is tested and, therefore, has an edge over the new one. The existing investments will, therefore, get more funds allocated to them in terms of capital. Maybe, the company has to make a painstaking anlysis to figure out what investments are the best and whatare not effective for the company. It is the only way the best investment decisions can be made.

ReferenceRosevear, J. (2012). Why cadillac is crucial to GMs revival (GM). Stock Investing Advice: Stock Research. Retrieved from http://www.fool.com/investing/general/2012/08/09/why-cadillac-is-crucial-to-gms-revival.aspx