Friday, June 4, 2010
New GM venture raises uncomfortable questions
Is anyone else uncomfortable about Friday's announcement by post-bankruptcy General Motors, still the largest U.S. automaker, that it would create new venture capital firm to invest in new technologies? The new GM, now 61 percent owned by the U.S. government, said it would put $100 million into a new company to help startup companies working on renewable fuels, advanced materials and other automobile-related ventures. The announcement, reported by the New York Times, came amid an almost unbelievable run of good fortune for the company, which was able to shed a list of troubled subsidiaries in its short trip to bankruptcy court. GM reported its first quarterly profit in three years while its chief rival, the usually unimpeachable Toyota Motor Co. -- is still preoccupied with the discovery of manufacturing defects that caused the recall of millions of cars worldwide and resulted in millions of dollars in fines, so far. “We are constantly looking for ways to deliver the best technology for our customers,” Stephen Girsky, a G.M. executive, said in a written statement. “Our goal is to nurture these innovative technologies to help bring them to market, and to ensure our customers have access to the best technology available.” Spokeswoman Sherrie Childers-Arb told the Times that the new subsidiary, General Motors Ventures, had already identified companies to invest in. But will it be the new, nimble, embarrassed and chastised GM that will be buying into startups with promising ideas, or the old GM that wants to buy new companies to block their products from gaining market share? That's what happened, we still can recall, to the early electric car and, even earlier, to transit systems across the country.