GM's CEO talks about the future

February 8, 2008 7:46:33 PM PST
It used to be number one. It got Americans hooked on gas guzzlers like SUV's and mini vans. However, pressure from the government, consumers, and environmentalists has General Motors singing a new song. Its CEO of eight years is facing a campaign to be the auto maker of the future.

There used to be a saying: "As General Motors goes, so goes the country." GM has gone through tough times, losing billions of dollars and contentious labor issues. But now, like other auto makers, it's focused on developing new technology to fuel cars.

Rick Wagoner could have touted how its Cadillac CTS and Chevy Malibu are putting GM back on the map with strong sales and rave reviews. Instead, he seemed focused on the big changes ahead for the auto industry.

"I think we are somewhat like the auto industry was back in the early days. If you study the history of the auto industry, the late 1800's, early 1900's, there was a range of propulsion systems, and it wasn't clear that gasoline powered internal combustion engines were going to be the winner. Steam power, battery power back in those days, and these technologies were fighting out to see which was going to be the winner," says Rick Wagoner., General Motors Chairman and CEO.

Today, automakers are investing hundreds of millions of dollars to figure out whether hybrids, electric, or fuel cell propulsion cars are the answer to curbing oil dependency and environmental impact.

"We don't know which one of these technologies is going to win. We could put all of our money on ethanol or all of our money on batteries, but if we call that wrong, it could have severe consequences," says Wagoner.

ABC7's David Louie: "Who's going to pay for it?" Will the consumer ultimately see higher auto prices?"

Rick Wagoner: "To be honest, it wouldn't be accurate for me not to say, as we see the technology today, to cover the costs of those is going to mean higher vehicle prices at some point in the future."

Alternate fuel vehicles are sparking plenty of attention at car shows, but Wagoner worries a chicken and egg scenario lies ahead. Once the cars are built, where do they fuel up?

"There's like 1400 refueling stations in the U.S. out of 170,000 pumps available. We've had a hard time getting even that ramped up. So it highlights to me, if we want to move as a society to some of the new forms of propulsion, we are going to need some support in things like infrastructure," says Wagoner.

The Nummi plant in Fremont has been a joint venture of GM and Toyota for 20 years. Wagoner gave no indication the partnership is over, even as Toyota surpassed GM last year as the world's #1 automaker.

We played a word association game with Wagoner.

ABC7's David Louie: "Toyota."

Rick Wagoner: "Competitive."

ABC7's David Louie: "Anything beyond that?"

Rick Wagoner: "They're strong in a range of activities. We have a lot of respect for them."

Wagoner notes China is a fast growing market for GM, along with Russia, India and Brazil. So, fuel diversity is a global issue and not just an American issue.

"We are, right now, at the beginning of what I think has the chance to be one of the most exciting periods of the industry ever," says Wagoner.