General Motors is one of the largest firms in the United States that supplies automobiles. It has an Oligopoly market structure. Oligopoly is according to Investopedia, “a market structure with a small number of firms, none of which can keep others from having significant influence.
” The automobile industry in the United States comprises of Three main firms. The three firms are General Motors, Chrysler, and Ford. There are some characteristics that support General Motors as an Oligopoly. Interdependence is one for example because as mentioned before, there are only a couple other firms that compete with General Motors and any changes in the price and/or product by any of the firms would have direct impact on its rivals. Another example is advertising and selling costs because in this type of market, these firms apply defensive as well as aggressive strategies to gain greater share in the market. Other market structures like Perfect Competition and Monopolies, don’t really need advertising. There does exist some Monopoly in under an Oligopoly because each firm does have control over a large part of the market.
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