We are bearing witness to an apocalypse of world finance. Square in the eye of the storm is the auto industry.
Its hard to fathom the events of the past 24 hours. The President of the United States fired GM CEO Rick Wagoner, and though he specifically said the government “has no intentions of running GM,” its hard to argue that they won’t be playing a major role. This is reasonable to expect considering how much money taxpayers have already invested and will continue to invest to reorganize the company.
It seems the White House is sincere about its intent to sustain GM either with or without bankruptcy.
But how will the Volt fit in? Certainly one might feel a bit melancholy about the loss of two of the Volt’s main linchpins, Lutz who steps down as vice chairman after today, and now Wagoner who is gone.
The Volt team and its engineers, and other supportive high level VPs remain in place.
The President’s Task Force on Autos issued a brief analysis of GM business operation ahead of Obama’s announcement that explains how they determined viability. In that document the following statement is written:
GM is at least one generation behind Toyota on advanced, “green” powertrain development. In an
attempt to leapfrog Toyota, GM has devoted significant resources to the Chevy Volt. While the
Volt holds promise, it is currently projected to be much more expensive than its gasoline-fueled
peers and will likely need substantial reductions in manufacturing cost in order to become
Since the government now decides what stays and what goes, could the Volt get thrown out with the bathwater? I would think not considering how important the White House views electric cars and energy independence, and their realization that new technologies are always more expensive at first.
“As the White House has said, they do not intend to run a car company, much less make product decisions. They recognize the Volt for the game changer it is. And yes, no kidding, that costs money up front. But, this is a long term play for us.” GM spokesperson Greg Martin told me. “Not to fear, the Volt is safe.”
And to be certain, on his last day I turned to none other than soon-to-be former GM vice-chairman Robert M. (Maximum Bob) Lutz.
“Thanks for your concern. Volt will survive and prosper. We know the numbers better than the Government…we furnished them! First-generation technology is expensive, but you can’t have a second generation without a first generation,” Mr Lutz wrote me in an email. “Common sense and intelligence will prevail, here!”
This entry was posted on Tuesday, March 31st, 2009 at 5:51 am and is filed under Financial, Politics. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.