Bankruptcy is a word heavy with stigma. It's a sign of defeat, and typically of retreat.
But don't tell that to Tony Posawatz, the General Motors Corp. GM-N executive in charge of producing the auto maker's first electric car for the masses. For Mr. Posawatz, GM's current crisis is just a bend in the road. He's focused on the horizon – years out – when the humiliation of a government bailout and filing for bankruptcy protection is just a bad memory.
In Mr. Posawatz's vision of the future, GM has leapfrogged archrival Toyota Motor Corp. in the race to produce the world's greenest car, re-establishing its global technological lead among car makers. And his baby, the electric-powered Chevy Volt, is creating such a buzz among buyers that it casts a halo over everything else the car maker sells, from Camaros to Silverados.
“The Volt is really about setting up the future, and how we can win and compete,” Mr. Posawatz, a lifelong GM employee whose father also worked at the car maker, said in an interview. “We want it to be viewed as an iconic technological marvel, a remarkable machine.”
Think of what the iPod did for Apple, or the Wii for Nintendo, and you have some idea of how much is riding on a car that won't even begin production until 2010. That's more than a year after GM emerges from a bankruptcy filing expected on Monday.
The Volt is GM's equivalent of a moon shot – a car that re-energizes the crippled giant and saves it from technological oblivion. It is now at the heart of the company's struggle to reinvent itself as a lean and green auto maker, shedding the baggage of years of dependence on gas-guzzling pickup trucks and sport utility vehicles that generated profits but covered up cracks in the foundation of what was once America's mightiest company.
How GM reached the point of desperation where it needed the halo of a game-changing car and tens of billions of dollars in government financial help is a tale of decades of mismanagement, missed opportunities and the arrogance that comes from being the world's largest auto maker for 77 of its 100 years of existence.
The expectations are extraordinarily high for what looks to many outsiders as a bit of a fringe car. GM is likely to lose money on every Volt it sells, at least initially, while producing as few as 11,000 in the first year. And the Volt is expected to sell for roughly $40,000 (U.S.), about twice the price of a competing vehicle, the 2010 Toyota Prius.
The project originated in 2005 from the growing frustration of Bob Lutz, GM's recently retired vice-chairman and product czar. It ate at Mr. Lutz that Japanese rivals Toyota and Honda were getting all the credit for leading the green revolution with new hybrid and battery technology.
So he conceived and championed a vehicle that would put GM back on top.
“In one respect,” Mr. Lutz remarked, “it is the car that will save General Motors in that the car almost single-handedly re-established General Motors' aura of technical competence – if not technical leadership.”
Reversing the collapse
It is a stretch to characterize the Volt as the car that will save General Motors from the host of other critical ailments the wounded giant faces.
The company still has too much assembly capacity in a market that has all but collapsed from the level of 16 million vehicle sales annually through most of this decade. GM is scaling back to four divisions from a bloated eight by shedding Hummer, Pontiac, Saab and Saturn, but even four brands may be one too many in the shrunken market.
And halting and eventually reversing years of market share declines and consumer perceptions that GM quality doesn't stack up to the best is a mammoth undertaking.
