July 10, 2009 -- The irony is undeniable. While General Motors Corp. was winding through bankruptcy proceedings this summer, its products were starring in the biggest blockbuster of the season. "Transformers: Revenge of the Fallen" features warrior robots from outer space, turning themselves into -- what else? -- Chevrolets.
For its many critics, GM's promise to rebuild itself from a bankrupt relic into the innovative carmaker of the future is no less fantastical than the transformations on screen.
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If GM succeeds, much of the credit will go to its design team -- artists who must ignore the financial problems of today in order to pave the way for the company's viability tomorrow.
Their boss is GM's vice president of global design Ed Wellburn, who famously sent a letter to GM at the tender age of 8, begging for advice on how to become a designer. Fewer than 20 years later, he started working for GM and he now spearheads its design unit with the same boyish passion.
Located in Warren, Mich., the cryptically named "Studio X," which is the design team's inner sanctum, is modeled after the top-secret workshop of legendary automotive designer Harley Earl, who pioneered industry-changing classics like the Corvette.
While the designs have changed, the extreme secrecy has not. "I've got to tell you, there are very few people who work for General Motors who have ever been in Studio X. I'd say maybe 20 or 30 people over the years," Wellburn said.
"20/20" Goes Inside GM's Creative Nerve Center
Like a car lover's version of Willy Wonka's chocolate factory, Studio X is a cauldron of ingenuity and secrecy.
Throughout the studio, new ideas are manifested in a variety of forms, from clay models of the designers' most nascent ideas to advanced prototypes kept tightly under wraps.
One of the more well-reviewed cars to come out of Studio X in recent years is the new Chevrolet Camaro. Its success hints at what seems to be a bigger trend: Retro-styling combined with more modern features and enhanced drivability.
Although the Camaro is considered an American classic, the new version was designed by a Korean, engineered by Australians and built by Canadians. For some people, such collaboration is indicative of the lack of passion and ingenuity that has hampered the U.S. car industry of late. For others, it's merely a sign that a multi-national approach is the way of the future.
"It's a global world now. ... It's a much bigger world now and we can take the expertise from all those different areas and bring it together," Chevrolet product manager Cheryl Pilcher said.
One of GM's most promising product ideas is "V-to-V" technology, which would enable cars to sense other vehicles or pedestrians and thereby prevent collisions. But there's a catch: The other cars and pedestrians must also have purchased the V-to-V device in order for the technology to work.
In contrast, the Chevy Volt is much closer to being a market reality. Considered by some people to be GM's "moon shot," the product could potentially leapfrog popular hybrids, like the Toyota Prius when it hits showrooms next year, analysts say .
Wellburn said the Volt's sleek, accessible, yet stylish, design "was very much influenced by the iPod."
It plugs into any outlet, he said, and a fully-charged Volt can go 40 miles without burning a drop of gas. After that, a small engine kicks in to recharge the batteries, with an ultimate gas mileage anywhere from 50 to 150 miles per gallon.
After Several Missed Opportunities, GM Scrambles to Go Green
This is not the first time GM has dabbled with greener technology. In 1996, GM unveiled the EV1, a fully electronic car designed to comply with California's strict emissions regulations. With little marketing effort from GM, and in the heyday of America's SUV craze, the cars still became a cause celebre, with stars like Tom Hanks and Mel Gibson touting their benefits.
Yet, to the dismay of many customers, GM recalled the first generation of EV1s in 2000, citing fire hazards. Three years later, GM ceased production altogether, going so far as to send remaining cars to the crusher. GM blamed the car's demise on lackluster consumer demand; critics blamed oil industry lobbyists for successfully delaying the new emissions standards.
Regardless of who is to blame, the recall of the EV1 proved to be a massive strategic blunder for GM. Toyota seized upon this new void in the market, successfully branding itself as smarter and "greener" with the Prius. Meanwhile, the demise of the EV1 only galvanized the green car movement at large, encouraging innovation far away from Detroit.
The far-flung revolution means that numerous contenders outside the established auto industry are nipping at GM's heels. In Brazil, a flight attendant named Marcelo de Luz built a solar car from scratch, and has driven more than 20,000 miles on sunlight alone. Even rock star Neil Young figured out a way to electrify his 1959 Lincoln.
And, in Silicon Valley, Calif., Internet mogul Elon Musk founded a car company called Tesla. Its electric sports car has a super-light body and is powered by more than 7,000 lithium-ion laptop batteries.
Like the ill-fated EV1, the Tesla charges in the simplest way possible. "It's really as easy as plugging in a hair dryer," Musk said. "Just basically take an extension cord, plug it into the wall, that's it."
A single charge powers the Tesla for almost 250 miles at speeds of up to 150 miles per hour.
There are only 500 Teslas on the road but, even with a price tag of $109,000, there's still a wait list to buy one. For consumers of more modest means, there's good news. The car's batteries are becoming better and cheaper, so Tesla plans to release a $30,000 sedan by 2012.
Tesla's innovations may be another missed opportunity for GM, which declined to work with the entrepreneurs despite exploratory conversations, Musk said.
"They were not interested in working with us," he said. "They seemed to think that ... there was nothing that a car company startup in California could teach them."
Mercedes signed a deal with Tesla and, once again, GM is playing catch-up. GM executives now concede that Tesla's designs inspired them to conceive the Volt. But, with such new technology, it will be years before they will be able to turn a profit on the car.
Experts: GM Must Focus on Quality, Reliability
"It is not what is going to save General Motors over the next two, three or five years. It is a further-out technology," said Steven Rattner, a member of President Barack Obama's task force on the auto industry.
In any case, finding and keeping new customers will be critical to GM's future. Right now, the prognosis is mixed.
The Chevy Malibu was Motor Trend's car of the year in 2008. According to J.D. Power, new car buyers rate Chevrolet above the industry average in initial quality, and another GM brand -- Cadillac -- is third only to Lexus and Porsche.
But the company doesn't do as well in terms of durability.
"A lot of GM products have problems with their transmission, with electrical features, and also, interiors, sort of squeaks, rattles, parts of the trim dropping off," David Champion of Consumer Reports said. "They've come out with some great cars, but they still haven't cracked that reliability."
Despite GM's image problems, most experts agree that GM has a fighting chance, provided it buckles down and focuses on building high-quality cars, one at a time. They cite Hyundai -- once a national punch line and now equal to Honda and Toyota -- as a case study.
For the former industrial titan, bankruptcy has brought the challenges of the future -- if not the way forward -- into sharp focus.
"That is the beauty of America," commentator P.J. O'Rourke said of the indusrty's ills. "It's not just about winning, it's about losing."