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External Environmental Analysis

General Motors Defense faces an external environment that is highly turbulent, complex and global conditions that makes it very competitive. The main competitors of General Motors Defense are General Dynamics and United Defense. General Dynamics (GD) was a leading defense company, which for most of the U.S. Department of Defense programs, had shared the market with United Defense. General Dynamics was established in 1952 and in 1982 it added its combat system business unit, General Dynamics Land System (GDLS). General Dynamics has its corporate headquarters strategically located in Falls Church, Virginia near Washington D.C. Therefore its Government relations served as the company's liaison with Congress and all branches and agencies of the U.S. federal government. GD hence had a strong government relations department and being one of two players in the market had significant political power regarding U.S. Army programs.

GDLS had previously before formed a joint venture with Vickers Defense System (VDS) to work on the Future Scout and Cavalry System program. However GDLS joined with VDS to ensure that GDLS could maintain its leading position in the design, development, and manufacture of armored vehicles for the future. GD therefore strategizes to form joint ventures in order to increase its capabilities and hence maintain its position in the market. GDLS had been a great contributor in the U.S. Army's core programs and worked in partnership with them to ensure success. GDLS capabilities were strong and they had a proven record in engineering research, development, and technological innovation in the defense industry. The capabilities present in GDLS are precision machining, experience with steel and aluminum and special armor, product fabrication, assembly, technical training, total package fielding, manufacturing technical assistance, contract logistics support services, systems integration, combat systems development, electronic production and assembly, software development, and prototype development. Also to enhance its capabilities, GDLS acquired AV technology in 1998 and Robotics Systems Technology in 1999.

GD also utilizes its capabilities and having joint ventures with other companies, fully exploit the resources/capabilities of the company and therefore win the bid for contracts. GD uses its price attractiveness in hope of beating its competition to win bids also. Having significant political influences GD could "Kill the Program" if they did not win the contract for a specific army program and therefore the funds would therefore be used for another program for which GD could put in a bid for.

The only other competitor to General Motors Defense is United Defense whose board included former Secretary of Defense and former Chairman of the Joint Chiefs