How GM Decided to Shoot the Moon

Last Updated Aug 27, 2010 5:19 PM EDT

Falling market share, shuttered plants, dead brands, bankruptcy, and a government bailout — that's been the news out of GM in recent years. Yet all the while GM has been investing $1 billion in the Volt, a revolutionary car that just might help save the troubled automaker.

Big decisions come from big questions, and in 2006 a few key GM execs began posing this one: What if GM stopped thinking in terms of squeezing more miles per gallon out of each car, and instead started asking about how not to use fuel at all? Would kind of car would GM create then? The answer is the Chevy Volt — an "extended-range electric vehicle," or E-REV, that GM hopes does nothing short of revolutionize the auto industry.

The Volt, which is set to go on sale late next year, is unlike today's hybrids because of one key difference: In certain circumstances, it can get infinite gas mileage. A lithium-ion battery powers the Volt for the first 40 miles. After that, a gas engine kicks in to create more electricity to keep the car rolling. So if you recharge your Volt before you hit 40 miles, you never need to go to the pump.

This is the kind of breakthrough that GM execs hope restores the company's technological reputation — and changes the world to boot. "Basically," says Jon Lauckner, GM's vice president of Global Product Planning, "this is our version of the moon shot." As such, it could very well prove one of the boldest decisions in GM history.