Explaining Southern California's economy

LA Auto Show: With Chevy Cruze, Sonic, and Spark, GM has cracked the code on small cars

LA Auto Show -  31

Anibal Ortiz / KPCC

The 2014 Chevrolet Spark EV is introduced at the LA Auto Show. It's the smallest vehicle in the entire GM lineup. It's all-electric. And its shows that GM is at long last taking small cars seriously.

General Motors.

Small cars.

Two concepts that, a decade ago, few would have uttered in the same breath. GM had left the small car market for dead. While it focused on trucks and SUVs and their nice, fat, profit margins, and also dedicated itself to turning Cadillac into a high-performance brand while simultaneously saving Buick, it left low-margin small cars to Honda, Toyota, Nissan, Hyundai, and Kia. 

Honda and Toyota got started in the U.S. market with small cars, so they always knew what they were doing. Hyundai and Kia, the South Korean upstarts, simply copied the Japanese playbook. 

Then the financial crisis struck. The federal government bailed out GM, then the company went bankrupt. Somewhere amid one of its numerous pre-Chapter 11 restructurings, GM got religion on small cars.

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Fisker electric-car scandal: Is this the new Solyndra?

Biden Announces Conversion Of Idled GM Plant To Electric Car Manufacturing

Jeff Fusco/Getty Images

WILMINGTON, DE - OCTOBER 27: U.S. Vice President Joe Biden speaks at the former GM Boxwood Plant on October 27, 2009 in Wilmington, Delaware. Fisker Automotive announced that the company is buying the plant to produce affordable plug-in hybrid automobiles. (Photo by Jeff Fusco/Getty Images) *** Local Caption *** Joe Biden

The Department of Energy's $535 loan gurantee to bankrupt solar startup Solyndra has become the Obama Administration's first quasi-scandal, with critics insisting that the government shouldn't be funding risky green-energy companies and supporters (myself included) arguing that the government is the only investor that can handle the risk. But now the bickering has spread beyond solar to the go-go world of electric vehicles — just as "Revenge of the Electric Car," the sequel to "Who Killed the Electric Car," is hitting theaters.

ABCNews and the Center for Public Integrity have teamed up to investigate DOE loans guarantees, focusing on two marquee EV companies, Tesla Motors and Fisker Automotive, which together have received about a billion in government-backed financing. The takeaway isn't pretty:

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