The economy is bad and while the computer industry has been hard hit, the hardest hit of all may be the automotive industry. Executives from the largest American automakers have been begging for help from the U.S. government, despite flying down to beg for money in private jets.
In the midst of the economic turmoil, the future of alternative fuel vehicles like the Chevy Volt may be question marks in many minds. However, GM is putting the Volt at the forefront of its business plan as one of the keys to justifying loans for the U.S. government to prevent insolvency of the automotive giant.
GM CEO Rick Wagoner told a congressional committee, "We're putting a lot of money into the Chevy Volt, which we're endeavoring to get into production by 2010. It will not be at that point fully cost competitive."
GM is saying that it will take the better part of a decade for vehicles like the Volt to become profitable. The issue right now for GM is how to maintain its business until alternative fuel vehicles, like the Volt, that consume massive sums of money in research and development provide a return on the investment.
GM told congress that it has spent more than $750 million to develop the Volt with much of that amount going to battery research. GM spokesman Rob Petersen says, "The Volt is the first step in a long-term viability plan."
GM also says that expensive and research intensive projects like the Volt can lead to other technologies that can be used in other vehicle types to improve efficiency. The battery research alone can yield improvements in product categories far removed from the automotive industry such as the consumer electronics realm.
Peterson says, "We expect to reposition General Motors as a technology leader in the industry."