Passing on Innovation Led to Bankruptcy for an American Icon?

General Motors dropped from DOW today as it filled for bankruptcy this morning. The Obama administration is to purchase the remains of the suffering company for $30 billion, with the Canadian government chipping in an additional 9.5 billion for the Canadian branch of the company. Together the two governments and the remaining GM staffers will have an arduous task of restructuring the giant company in to a leaner organization in the hopes that it can again rise to be a profitable employer to thousands.

Almost prophetically the documentary Who Killed the Electric Car? was broadcast on TV the night before GM officially filled for bankruptcy. The documentary details the story of the EV1, GM’s electric car that was released in 1996. While GM did produce the EV1, they did little else to bring the innovative car to the market place. There was little or no promotion.  They didn’t let people buy the EV1, leasing was the only option to procure the vehicle. They even put A-list celebrities such as Mel Gibson through lengthy questionnaires prior to letting them lease an EV1. in 1999 when GM stopped production of the EV1, they pulled all of the EV1s on the road and destroyed them, an action that was made possible by their lease only policy.

GM put an inferior battery in the first edition of the EV1, even though the owned a controlling interest in a company that had a patent for a  far superior battery invented by Stan Oshinsky . Sadly GM only released 200 second generation EV1’s that included the superior battery, and later GM sold it’s shares to Cheveron/Texaco who were free to suppress the innovative technology.

When GM squashed the EV1 they choose greed over innovation. This was a massive mistake. Our world is riddled with massive problems, and GM had a solution to a hand-full of them, and tossed it in the garbage, to the detriment of the company’s profits,  it’s some 250,000 American  employees, and most importantly the greater good. The EV1 was positioned to help with:

• The pollution problem
  

  LA Smog

• Dependence on foreign oil
  

  Desert Storm

• Rising gas prices harming industry and families
  

  Rising gas prices

Innovation should not be squandered! Google did not earn $22 billion last year because they choose to ignore innovation. Innovation brings greater wealth than clinging on to old ideas ever will. Seems to me that GM learned this the hard way… well, lets hope they have learned this!

In the documentary Wally E. Rippel, a research engineer, points out that there is still about a trillion barrels of oil in the earth. “At $100 a barrel, that’s $100 trillion of business left in the ground”. The fat cat oil companies have so much to gain from prohibiting new technologies from taking over our current consuption of oil and gas, and they have the power to make it happen. Their pressure on the government, and the car companies, including GM, ensured that the EV1 would not survive. Under these pressures GM chose the gas gusseling Hummer over the EV1. Ironically now, GM owes over $1 million for every Hummer on the road.

There are many lessons to be learned here. Lessons that are not new. Lessons that we all learned back in grade school from Dr. Seuss and Sesame Street. Mainly: greed does not pay in the long run.  Society and technology will continue to innovate and progress as we move into the future, because it has to.  Our population is growing, and our resources are finite. We have to come up with innovative ideas to survive in the long run. Setbacks such as the demise of the EV1 only slow progress and innovation, to the detriment of our future generations. I hope the governments inheriting the remains of the once mighty American company will have the foresight and wisdom to remove this hindrance on progress and revive the Electric Vehicle project.

Check out Who Killed the Electric Car? the trailer is available above.