GM posted a 15 billion dollar loss, others are posting large losses and no gains.

A bailout will change the aspect of American Automobiles

the whole issue regarding the chevy volt and its potential success is enough for its own case study. although there are names written down who would purchase a chevy volt, its success is dependent on more than just product hype, and consumers who may potentially be full of just as much hot air as bob lutz. this is essentially gm’s last chance at delivering a solid, innovative product.

another point of interest the “new” chevy camaro. i see it as a huge marketing fiasco. what began as a vehicle with arguably as much attention as the chevy volt has calmed down to mere whispers, as consumers await its arrival. heck, i think the concept was first presented in 2006. transformers came out a year ago, presenting the perfect marketing platform, and yet, the camaro still isnt out.

the next couple months are going to be very interesting. i think a follow-up article in a couple months on gm and its attempt at recovery would be a very interesting read.

There is already a 10,000 name long list of people who will buy the Volt, so I think your strategy of wait and see will work out well. Also, I think a lot of Americans share your sentiment about wanting GM to survive. Therefore, if the Volt delivers on its promises, it could go a long way to digging GM out of its hole.

@Brendan: You bring up an interesting discussion. Around these parts, it is often assumed that open = good and closed = bad. However, I think in this case it is true.

While GM’s approach to their battery development may be more cost effective, I don’t think cost is their primary reason. GM actually increased its R&D budget from $6.6 to $8.1 billion last year despite losing $1 billion a month in cash.

As you say, their open solution may result in having a similar platform to everyone else but I think a lot more goes into developing these cars than either you or I think. The only company (to my knowledge) that has announced a plug-in hybrid electric vehicle by 2010 is Toyota. However, Toyota has had a very late start in developing lithium-ion batteries as they recently switched from nickel-hydride. I personally know very little about how this technology works, but I recommend Matt Jansen’s blog on techblorge if you are interested in comparisons between GM’s Volt and Toyota’s Prius. One post on the blog says that Toyota may be developing a battery that blows GM’s lithium-ion batteries out of the water. If this is true and comes to market relatively soon (before a hydrogen network can grow), then Toyota’s closed approach may prove very effective.

Also, I think GM’s battery development probably falls into the “developing proprietary solutions collaboratively” category. The Volt’s solution is different enough from current offerings as it no other car can run purely on electricity for as long as the Volt promises to. Although the details on Toyota’s plan are still murky (a function of them being more closed), it seems to involve a close partnership with Panasonic’s electronics supplier with a factory built in central Japan. As I stated in my original post, this does not bode well for selling its future electric vehicles in China.

However, only time will tell which approach will prove to be more effective. I think the Volt is poised to do very well in North America with its sleek, muscled design combined with its practical implications.

P.S. I really enjoyed reading your innovation blog.

I was shocked. The car is beautiful, inside and out. It is very quiet, it performs responsively and with plenty of power, gets reasonably good gas mileage, and had numerous bells and whistles that are appealing. I had a very good driving experience. I wish that it was E85 worthy, since ethanol is finally coming to a station near me. Still, for the first time in decades, I had my head turned by a Chevy. If it used alternative fuels or better, were a plug-in hybrid vehicle, I’d consider it instead of the Toyota or Nissan plug-in hybrid I’ll probably buy in 2010. But it is a great car, just a decade too late to make a difference in the automotive world we find ourselves in.

I admire your optimism but I think this decision is driven by economics rather than strategy as GM does not have the dollars to invest in developing a solution but Toyota does.

Battery technology is THE key differentiator in electric vehicles and GM is in danger of having the same solution as everyone else as a result of this decision, a poor platform to succeed.

You need to be careful about suggesting Open = good and Closed = bad.

Innovation theory suggests that it makes sense to develop proprietary solutions (ie closed) when outsourced (ie open/modular) ones are currently ‘not good enough’ and this is certainly the case with battery technologies today. This is because a proprietary solution attracts a premium in the market and the Apple iPod is a good example of this theory in practice today.

It is possible to develop proprietary solutions collaboratively as Apple have and Toyota are, but the result is a proprietary and differentiated solution. The result can then also be made available under license to competitors such as GM (another possible scenario here).

I think this decision reflects the dire state GM is in and no matter how you twist it this decision does not look good but rather pragmatic!