KEN GRACE: This is a 1967 Pontiac GTO. It’s got a 400 cubic engine and 360 horsepower, four-speed transmission - so exactly the way it was built in 1967.

BOWDEN: Meet Ken Grace, my guide to the muscle cars of Detroit. He had one much the same when he was seventeen. Detroit’s teenagers won’t have the option of owning a new Pontiac. General Motors has just killed the Pontiac brand - yet another sign that one of the world’s best known companies and its home town are in desperate trouble.

KEN GRACE: Back in the 60s and 70s you could see people in the city of Detroit walking the streets, and the factories were full of cars and full of employment, some running three shifts. It was an honour to say ‘yeah I’m from Detroit’. A tough city, a lot of issues, but you were proud because everybody around the world drove our vehicles.

BOWDEN: A city which worships the car, doesn’t have much of a public transport system. The monorail, called the people mover seems more for show then effect, but it does give you an uninterrupted view of a city in decline.

Once the murder capital of America, now businesses are being killed off and residents have fled. Building after building vandalised or awaiting the wrecker. Eerily too, the streets of motor city are empty of traffic.

The most striking thing about the centre of Detroit these days is how quiet it is. On almost every street there are signs of urban decay and a sense of desolation and there’s disbelief that the big car companies centred here could be in so much trouble.

Ford, which is in the best shape, recorded a two billion dollar loss in the first three months of the year and that was viewed as something of a triumph. General Motors, once the biggest car company in the world looks like it will have to go into bankruptcy to survive.

ROBERT KLEINBAUM: There are no companies that are too big to fail. If Lehmann’s can fail with its 100 year history, I think GM could fail, and I don’t think it’s too big to fail.

SARAH WEBSTER: When I moved to Detroit in 1999 this town was rolling in profits from the SUV business. Everyone got bonuses that year, they even gave out free computers at Ford and they had a plane flying around town thanking workers for their great contribution.

CARMEN SEATON: I never imagined that in a million years for General Motors, the number one company in the United States to be in this predicament, no way.

BOWDEN: This is not simply a story of another industrial town falling on hard times and few know that better than Dick Purtan – Detroit’s veteran, top rating radio announcer who was spinning discs back in the 60s.

So was there a real energy about Detroit?

DICK PURTAN: Oh yeah a big time energy. Remember in those days, Detroit would have been the fifth largest city in America. And then I have seen in the… what, 45 years that I have been here, it’s gone from 5th to 6th to 7th to 8th to 9th to 10th and I think currently we’re the 11th rated market or city in America.

BOWDEN: Detroit became the emblem of American know how and can do, the capital of industrial prowess. But it had more. It had its very own high energy soundtrack and like Dick Purtan’s listeners, the world came to love it as well - Motown.

DICK PURTAN: I was thrilled to be here because this was a real happening town. And one of the reasons it was happening was two reasons, the auto industry was thriving, people were thriving here big time… but Motown was booming.

BOWDEN: Forty years on, Ken Grace is still cruising the city listening to Motown music. It brings it all back.

KEN GRACE: On my radio I have a 1960s station and it plays Motown… Stevie Wonder… the Supremes.

MARTHA REEVES: This is a historic city because of motorcars and Motown was adapted from the name, motor city… Motown.

BOWDEN: Martha Reeves and the Vandellas were a big hit back then. She still belts it out, but has another stage too, making law as a Detroit city councillor.

MARTHA REEVES: You know it was a good feeling to have songs that you recorded when you were twenty one, twenty two years old and then when you sing them you can feel that young. You can think back and total recall to the day that you recorded it.

BOWDEN: Reeves started recording in Studio A at Motown Records. It became known as Hitsville USA, borrowing a production style from the car industry.

MARTHA REEVES: And in our history, Berry Gordy worked at Ford Motor Company and he thought of running a company as an assembly line. Once the doors open they never shut. We started up with two tracks… two recording tracks. Went from there to four. Hitchhiker, Stubborn Kind of Fella, Come and Get These Memories, Almost Like a Heatwave were all cut with four tracks…. and we grew from there.

BOWDEN: What would have been your favourite hit from those days that you recorded in Studio A?

MARTHA REEVES: Oh you can’t pick one. We’ve had some wonderful recordings and…. they’re like children.

BOWDEN: Could you give us a burst of Heatwave before we leave? Come on a few bars.

MARTHA REEVES: Well it’s hard to do without the band and the girls but my favourite part is [singing] ‘sometimes I stare into space, tears all over my face. Can’t explain it, don’t understand it. I ain’t never felt like this before……. It’s time to go.’

BOWDEN: Martha Reeves will be among those Detroiters celebrating fifty years of Motown this year, but she’s keenly aware that there’s not much to smile about. She’s watching her city run out of gas and its once great institutions being junked.

MARTHA REEVES: I have been asked that question, how are we surviving the fact that half of the cars in our city are foreign, that our cars aren’t selling anymore. Our big three are considering lay offs and die outs and the industry is not what it used to be, it used to lead the city.

BOWDEN: A forced marriage with Fiat is Chrysler’s way out of bankruptcy. The big daddy of them all, General Motors, looms as the biggest potential disaster. It’s closing plants and desperately negotiating a survival strategy. People who thought they had secure jobs, are facing the reality that the wheels are falling off motor city.

MITCH SEATON: That’s something that you, you know you feel in your stomach every day. You know you’re thinking about it. You can’t get it off your mind, you know? You would want for it just to be over, one way or the other. Let me know something.

BOWDEN: Mitch Seaton started working for General Motors thirty years ago.

So what was the image of the company then? I mean what did you expect if you got a job at GM?

MITCH SEATON: That you would be able to retire you know with a certain amount of dignity you know? High wages, good benefits, you know.

CARMEN SEATON: When we were children growing up in Michigan or in a city of Inkster or Detroit, we always knew that that was the ultimate job to get because so many people drove nice cars and had nice homes.

BOWDEN: Carmen Seaton also works at GM. Like many families, they’ve been the backbone of the car industry for generations.

CARMEN SEATON: We have so many people. I have four or five aunts, I have two uncles, I have a sister, two brother-in-laws and actually two grandfathers that both my grandfathers are retirees from the automotive industry.

BOWDEN: We’re at one of the many branches of the United Autoworkers. The guest of honour is Dick Johnston, a veteran GM employee. There’s a lot of love in the room for the committed unionist. Even so, high wages and generous health and pension benefits demanded by the Union over many decades have been a factor in the car industry crisis.

DICK JOHNSTON: When I first started, General Motors was really booming. Where I’m working at now in Ypsilanti - there was 16…. 17 thousand people when it first started. It’s gone from that down to sixteen hundred people, which is a big drop from what it was when I first started.

BOWDEN: In the 50s Detroit was booming and they built big monuments like this Spirit of Detroit – strong resilient, trusting in God to look after the people – maybe. But by the 80s, Japanese and other foreign car companies had started non union plants in America’s south. They were cheaper and more efficient and they were building the cars Americans wanted.

Former GM executive, Robert Kleinbaum lives about an hour’s drive outside the Motor City.

ROBERT KLEINBAUM: And they didn’t believe it because they’re so isolated from the market place. I hope it will be remedied.

BOWDEN: He says GM ignored public concern about gas guzzlers and moved too slowly to make greener cars.

ROBERT KLEINBAUM: Wherever there is a situation where you could do something like really hard and painful, but that would really solve the problem, or you do the minimum amount necessary, they always chose that latter path whether it was with the union or their own capacity or their management of their own brands, they were always very reluctant to do the hard things that would really fix the problem.

BOWDEN: Under GM’s latest restructuring scheme, the US Government would own half the company and the union retirement trust would have around 40%. Still minority shareholders could scuttle the scheme, forcing the company into bankruptcy.

ROBERT KLEINBAUM: The whole purpose of bankruptcy, Chapter 11 bankruptcy in North America is to permit the kind of restructuring the company desperately needs to do. The nice thing about Chapter 11 is you can write off your debt right? So that’s the whole point.

BOWDEN: Clean slate.

ROBERT KLEINBAUM: So that’s the whole point.

BOWDEN: Sarah Webster is one of the most influential voices in Detroit as the automotive editor of the Detroit Free Press.

At what point did you start to realise that it was reaching crisis point in the industry?

SARAH WEBSTER: I think it was at the end of 2005 that we started to write about the really enormous layoffs of sixty and seventy plus thousand workers and I think that that was the time when we started to see that there was a dramatic change in the workforce taking place.

BOWDEN: What’s the feeling amongst locals now?

SARAH WEBSTER: It’s almost like losing a loved one or something. They go through all that whole range of emotions you hear about where they’re in denial and then they’re angry and then they’re sad and depressed.

BOWDEN: Drive down almost any street in the inner city and there are boarded up houses and disused factories. Once grand buildings like the city’s railway station have been abandoned and yet the city seems powerless to stop urban decay and to reclaim the wastelands. All this plus a recession which locals say hit Detroit long before the rest of the country.

Of course there are some who prosper even in the worst of times. Jeff Darwish has been tooling around the suburbs near the Ford factories buying and selling houses for 24 years. He might feel for the locals but his vehicle of choice is a fancy German import. We met in Willow Street, ,Dearborn.

JEFF DARWISH: This is a middleclass area with good folks, Ford Motor Company, a lot of people work for Ford right here and work for the local hospitals and school teachers. It’s a good area.

BOWDEN: So what’s happened to the value of homes?

JEFF DARWISH: It’s plummeted. People have been saying 30%, I’d say more about 40-50%. This house here was in its heyday about three of four years ago worth about one sixty to one-sixty-five, we just sold it for fifty-six thousand and I didn’t sell it overnight. It took about a month to sell it.

BOWDEN: Most locals can’t afford new houses or new cars. With sales down by as much as half, car yards are bulging with unsold stock. Many are the designs of the past, big fuel hungry vehicles. Dealers are being sacked by the big three car makers and going to the wall.

This city is all about the car. You can’t go anywhere or do anything without one. Despite the gloomy predictions, General Motors reckons it has a sparkling future with some fantastic vehicles to match so we’re going out to the company’s tech centre to take a look.

As GM management deals with the present, this clutch of designers is looking to the future. And as the accents reveal, they’re a long way from home. They all started out with Holden in Australia.

MIKE SIMCOE: By the time the public are presented with a product we are two, three, four years ahead - we’re doing the next cycle product. So we’re happily in a position where we can always look to the future and recognise that everyone relies on us for the future and that’s our part in saving the company.

BOWDEN: As they design the look of the next generation of cars, other teams are working on revolutionary concepts. The hydrogen powered car is Mark Vann’s baby.

MARK VANN: This is a very special vehicle. It’s a Chevrolet Equinox fuel cell electric vehicle. It uses no petroleum whatsoever and the only emission is pure water vapour.

BOWDEN: So this vehicle is a vital part of convincing the Obama Administration that this company can be viable.

MARK VANN: Absolutely. You know we look at this as saying that this is our best foot forward. You know that in America, you know a lot of people you know have only thought of General Motors as building large SUVs. We can build very compelling vehicles.

BOWDEN: In fact the Obama Administration is now ordering companies which are drowning in red ink to become cleaner and greener.

PRESIDENT OBAMA: For the first time in history, we have set in motion a national policy aimed at both increasing gas mileage and decreasing greenhouse gas pollution for all new trucks and cars sold in the United States of America.

ANNOUNCER: [Detroit Motor Show] Ladies and gentlemen the future of automotive transportation has entered the building.

BOWDEN: Another of GMs green options was showcased at this year’s auto show in Detroit.

ANNOUNCER: I present the revolutionary Chevrolet Volt.

BOWDEN: The Volt as the name suggests is an electric vehicle running on rechargeable batteries and it’s due to be on sale from next year.

ROBERT KLEINBAUM: The Volt’s wonderful but it’s not going to be a commercially important car for a very long time. Commercially important in terms of generating positive cash and the President’s task force saw that very clearly. It’s basically five or six years down the road is the time horizon.

BOWDEN: GM executives plot the company’s future in the tower which dominates Detroit’s skyline. But Washington is in the driver’s seat. GM has already borrowed more than 25 billion dollars from the Federal Government and says it needs another ten billion to survive. The deadline for GM is the 1st of June.

MITCH SEATON: Anxious is not the word. It’s more like a frightening thing cause someone tells you that on June 1 your job is over. You’ve got to make some decisions. Well, you know, your life is going to change.

PRESIDENT OBAMA: I would love to get the US Government out of the auto business as quickly as possible.

BOWDEN: Mitch and Carmen Seaton are putting their faith in the new President. Back in January, they drove their motor home for 24 hours through a snow storm to witness his inauguration in Washington.

MITCH SEATON: I dug two big trenches all the way out to the street. I figured if I can get it out, you know if I can get it on the freeway, we were good to go if I didn’t get stuck between here and the freeway.

BOWDEN: So you really wanted to be there.

MITCH SEATON: We were going to be there for sure. I wanted my boys when they’re my age to be able to say I was there because you know, the first African American President to be inaugurated so I wanted them to be there.

BOWDEN: A photo of the family with a remarkable likeness of the President has pride of place on the living room wall.

CARMEN SEATON: I’m very very frightened but I am optimistic. I really am…. especially with Obama. I believe that Obama believes, you know knows that we have to be here and he’s actually going to, I believe that he’s actually going to make sure that GM become viable.

DICK PURTAN: We have to have an industrial base. Detroit has always been the industrial base. I hope that it will come back to being the industrial base. I think we have to have a sense of pride and realise who we are and we must remain. We can’t just give it all away.

BOWDEN: Martha Reeves maintains high hopes for the motor city and looks to the spirit of Motown.

MARTHA REEVES: I think Motown mood’s a good time at a party. I think any time you put on the Motown records you see the sunshine, the Temptation’s say “I’ve got sunshine” there’s sunshine in the music.

BOWDEN: Car assembly lines lifted many African Americans into the middle class and Motown was another ladder to success and the American dream. The people of Detroit would like to think that the glory days of the city can come again.

SARAH WEBSTER: It’s all a cycle. This place is very innovative and will rise again and there will be different things that come out of Detroit in the future.