Why did General Motors want to buy trolley systems throughout the U.S.?

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teachsuccess's profile pic

teachsuccess | High School Teacher | (Level 1) Educator Emeritus

Posted on

Hello! The short answer to your question is that General Motors wanted to secure a competitive advantage for the automobile industry.

While the trolley and railway industry had to pay for the building and maintenance of railway tracks, the automobile industry (along with the oil and tire industries) had managed to persuade Congress to fund the building of roads through federal taxation. In the late 1920s, General Motors purchased more than a hundred trolley systems across the United States, all for the purposes of dismantling and appropriating toward new uses. The trolley systems were converted into bus lines, and General Motors manufactured the buses.

General Motors and its co-conspirators (Mack Truck, Firestone, and Standard Oil of California) were interested in obliterating market competition from the trolley industry. This was the reason General Motors bought up the trolley systems. These companies were later found guilty of violating anti-trust laws but the penalties were insignificant; the automotive industry continued charting its meteoric rise unchallenged.

shmindle's profile pic

shmindle | Student, Grade 11 | (Level 2) Honors

Posted on

General Motors wanted to buy trolley systems across the U.S. so that they could introduce bus lines. General Motors had no intention of dealing with the trolley systems, and they were all dismantled. Because of this, people became reliant on these bus lines, which brought profit to GM. Since GM was the only company with bus lines, they had no competitors either, which was to their advantage.

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