Question

Why was it profitable for gm and ford to integrate backward into component-parts manufacturing in the past, and why are both companies now buying more of their parts from outside suppliers?

Answer 1

It was more profitable for gm and ford to integrate backward into component-parts manufacturing in the past because manufacturing costs less than if materials are purchased from the suppliers and both companies are now buying more of their parts from outside suppliers because it was more skillful to purchase raw materials, and then change them into operational parts, and use them to create a final product.