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DETROIT – A person with knowledge of General Motors' plans says Rick Wagoner will step down immediately as chairman and chief executive of the struggling Detroit automaker.

The person asked not to be identified because Wagoner's plans have not been formally announced.

The move comes on the eve of President Obama unveiling his plan to reinvigorate the U.S. auto industry. Obama and other administration officials have said they would demand deeper restructuring from General Motors Corp. and Chrysler LLC before they would get any more government loans.

Both companies are living on a total of $17.4 billion in federal aid.

Is this the End of GM as we know it, or a Media Stunt? If Wagoner does step down, can hardly wait to see what the next SOB does.

 

Heck, I'll take his job. with no experience I bet I wouldn't do any worse than the last 20 yrs at GM

 

The full article from the Associated Press: GM CEO Wagoner to step down at White House request

 

Sad to see the goverment make a move like this. It should be a companies place to make this call.

It is nothing but a BS PR move as Fitz Henderson is coming in.

The problem is the GM system Wagoner has been trying to change not one man. If the goverment wanted to do what would help they would remove some of the road blocks that prevent GM making some of the changes they need to make.

The bottom line is RIck made some mistkes but he is the best leader they have had in years. Anyone that comes in will be hard pressed to do any better till more internal changes in GM are made.

Read the new book Why GM Matters and learn how GM got to where they are and really what is going on to change GM now. This book tells you what the New York TImes and NBC or CNN will not tell you.

 

Obama was going to ask him to step down. PR stunt on the Goverments part.

 

Nobody would want his job this year ... he was only earning $1.00 for the year

 

He sure is not getting much on his stock options either.

 

I really don't think it's Wagoner's fault...

He did his job! He's supposed to make the company money. If big trucks and SUV's were making money, he was doing the right thing by having them make more! No one saw this economy blow coming!!

It's not really his fault. But that's just my opinion. In fact, I single handedly blame Roger Smith!!

 

DETROIT – General Motors Corp. Chairman and CEO Rick Wagoner will step down immediately at the request of the White House, administration officials said Sunday. The news comes as President Barack Obama prepares to unveil additional restructuring efforts designed to save the domestic auto industry.

The officials asked not to be identified because details of the restructuring plan have not yet been made public. On Monday, Obama is to announce measures to restructure GM and Chrysler LLC in exchange for additional government loans. The companies have been living on $17.4 billion in government aid and have requested $21.6 billion more.

Two people familiar with the plan said Sunday that the Obama administration would give GM enough government aid to restructure over the next 60 days, while Chrysler will get up to $6 billion and 30 days to complete an alliance with Italian automaker Fiat SpA. The officials spoke on condition of anonymity because they were not authorized to make details public.

Wagoner's departure indicates that more management changes may be part of the deal, but it is still unclear who will be in charge of GM. The automaker recently promoted Fritz Henderson, its former chief financial officer, to become president and chief operating officer. Many in the company thought he would eventually succeed Wagoner.

Detroit-based GM issued a statement Sunday saying that the company expects the administration to make an announcement about the automaker's restructuring soon but that "it would not be appropriate for us to speculate on the content of any announcement."

A person familiar with Chrysler's management said the company has been given no indication that the government will require any changes at the Auburn Hills, Mich., company, which has been led by former Home Depot CEO Robert Nardelli since August 2007. The person also spoke on condition of anonymity because Obama's plan has not been made public.

Wagoner, 56, has repeatedly said he believed it was better for him to lead GM through its crisis, but he has faced sharp criticism on Capitol Hill for what many lawmakers regard as years of missteps, mistakes and arrogance by the Detroit Three automakers.

Wagoner joined GM in 1977, serving in several capacities in the U.S., Brazil and Europe. He became president and chief executive in 2000 and has served as chairman and CEO since May 2003.

Wagoner, in an interview with The Associated Press in December, declined to speculate on suggestions from some members of Congress that GM's leadership team should step down as part of any rescue package.

"I'm doing what I do because it adds a lot of value to the company," Wagoner said in a Dec. 4 interview as GM sought federal aid from the Bush administration. "It's not clear to me that experience in this industry should be viewed as a negative, but I'm going to do what's right for the company and I'll do it in consultation with the (GM) board (of directors)."

Auto industry analysts credit Wagoner with doing more to restructure the giant automaker than any other executive. But given that he has been at GM's helm for so long, many of his critics say he moved too slowly to take on the United Auto Workers and shrink the company as its market share tumbled.

"Given the history, a change in management could hardly hurt and might do some good," Sen. Charles Schumer, D-N.Y., said Sunday.

Among his biggest accomplishments as CEO, Wagoner presided over a landmark contract agreement with the UAW in 2007. In that four-year agreement, the automaker successfully transferred nearly $50 billion in health care liabilities to the union as it sought to reduce labor costs, especially huge liabilities to retirees.

In 2004, Wagoner sought to reduce GM's brands by shutting down the Oldsmobile line of cars — a costly project because it required huge payouts to dealers. He also sought to streamline the company by selling the company's defense unit, General Dynamics Corp., for $1.1 billion in 2003. He has also reduced the company's work force by tens of thousands and closed factories around the country.

But Wagoner's critics say GM relied for too long on sales of pickup trucks and sport utility vehicles for its profits and was unprepared for a drastic market shift when gasoline prices hit $4 per gallon last year.

During the Congressional debate over whether to give GM and Chrysler loans last year, many lawmakers criticized Wagoner, including Sen. Chris Dodd, D-Conn., chairman of the Banking Committee.

Dodd accused automakers' top management of having a "head-in-the-sand" approach to problems and said Wagoner "has to move on" as part of a government-run restructuring that should be a condition of financial life support for the auto industry.

David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich., said Sunday that Wagoner's departure gives the government a rationale to provide additional aid to the automaker. He was not surprised by the move, but said he is disappointed because he considers Wagoner a capable leader.

"I think that as a condition for further government support, this helps give them a little cover with the public," Cole said. "Essentially he's taking one for the team."

Cole noted that other automakers have been shaking up management as well. Toyota Motor Corp.'s president, Katsuaki Watanabe, recently said he would be stepping down as the Japanese automaker weathers financial difficulty. Also, France's biggest carmaker, PSA Peugeot-Citroen, abruptly ousted CEO Christian Streiff on Sunday, saying "exceptional difficulties" confronting the auto industry require new management at the top.

In the financial sector, where the overwhelming majority of government bailout money has been directed, some corporate leaders found their days numbered. The CEOs of mortgage giants Fannie Mae and Freddie Mac were forced out after the government took over the companies in the fall. Robert Willumstad, the former CEO of American International Group Inc., left the company in September, just a day after the government pumped $85 billion into the insurer to keep it from going under.

The terms of Wagoner's departure are unclear. However, GM disclosed in its annual report last month that it cannot make severance payments to Wagoner or other senior executives under the terms of its governments loans. Wagoner is eligible to retire under GM's salaried employee and executive retirement plans, but the amount he would receive is unclear.

Nardelli's departure is less likely than Wagoner's because Nardelli is "relatively new" to the automaker, with less than two years at the helm, Cole said.

GM and Chrysler were required by the Bush administration to get major concessions from debtholders and the United Auto Workers, with a deadline of March 31 for signed contracts. But very little headway was being made with either party this weekend as they awaited Obama's announcement.

Members of Obama's auto task force have said bankruptcy could still be an option for GM and Chrysler if their management, workers, creditors and shareholders failed to make sacrifices. Both companies are trying to reduce their debt by two-thirds and convince the United Auto Workers union to accept shares of stock in exchange for half of the payments into a union-run trust fund for retiree health care costs. The deals also call for executive pay cuts and labor costs that are competitive with Japanese automakers with U.S. operations

 

More Great News:

WASHINGTON – The White House says neither GM nor Chrysler submitted acceptable plans to receive more bailout money, setting the stage for a crisis in Detroit and putting in motion what could be the final two months of two American auto giants.

President Barack Obama and his top advisers have determined that neither company is viable and that taxpayers will not spend untold billions more to keep the pair of automakers open forever. In a last-ditch effort, the administration gave each company a brief deadline to try one last time to convince Washington it is worth saving, said senior administration officials who spoke on the condition of anonymity to more bluntly discuss the decision.

Obama was set to make the announcement at 11 a.m. Monday in the White House's foyer.

In an interview with CBS' "Face the Nation" broadcast Sunday, Obama said the companies must do more to receive additional financial aid from the government.

"We think we can have a successful U.S. auto industry. But it's got to be one that's realistically designed to weather this storm and to emerge — at the other end — much more lean, mean and competitive than it currently is," Obama said.

Frustrated administration officials said Chrysler cannot function as an independent company under its current plan. They have given Chrysler a 30-day window to complete a proposed partnership with Italian automaker Fiat SpA, and will offer up to $6 billion to the companies if they can negotiate a deal before time runs out.

If a Chrysler-Fiat union cannot be completed, Washington plans to walk away, leave Chrysler destined for a complete sell-off. No other money is available.

For GM, the administration offered 60 days of operating money to restructure. A frantic top-to-bottom effort began Sunday after CEO Rick Wagoner resigned under pressure from the White House.

Fritz Henderson, GM's president and chief operating officer, became the new CEO, a Treasury Department source said. Board member Kent Kresa, the former chairman and CEO of defense contractor Northrop Grumman Corp., will be interim chairman of the GM board.

One official said a majority of the GM board was expected to step down.

Obama advisers saw public outrage come to an ugly head in recent weeks, as populist anger escalated over bonuses paid to American International Group executives. They realized Americans are frustrated with the economy and its business leaders; they also said they would not invest one dollar more than was necessary to keep the companies alive and would walk away if it looked impossible.

Officials said GM had not made good on promises made in exchange for $13.4 billion in government loans, although there are no plans to call in those loans.

Administration officials still believe GM's chances are good, given its global brand and its research potential. Officials say they are confident GM can put together a plan that will keep production lines moving in the coming years. They planned to send a team to Detroit to help with that restructuring.

Chrysler, meanwhile, has survived on $4 billion in federal aid during this economic downturn and the worst decline in auto sales in 27 years.

In progress reports filed with the government in February, GM asked for $16.6 billion more and Chrysler wanted $5 billion more. The White House balked and instead started a countdown clock.

Administration officials acknowledged the short turnaround time was harsh; one described it as a nanosecond in a business cycle.

Two people familiar with the plan said officials will demand further sacrifices from the automakers and bankruptcy would still be possible if the automakers failed to restructure. Those officials spoke on condition of anonymity because they were not authorized to make details public.

Administration officials said they hoped large-scale bankruptcy could be avoided, especially if it might be stretched over many years. Any efforts to use the bankruptcy courts would have to be targeted and aggressive and must not prolong a restructuring process, they said.

GM and Chrysler, which employ about 140,000 workers in the U.S., face a Tuesday deadline to submit completed restructuring plans, but neither company is expected to finish its work.

GM owes roughly $28 billion to bondholders. Chrysler owes about $7 billion in first- and second-term debt, mainly to banks. GM owes about $20 billion to its retiree health care trust, while Chrysler owes $10.6 billion.

An exasperated administration official noted that the companies had not done enough to reduce debt; in some cases, it actually increased during this restructuring and review process.

In February, GM said it intended to cut 47,000 jobs around the globe, or almost 20 percent of its work force, close hundreds of dealerships and focus on four core brands — Chevrolet, Cadillac, GMC and Buick.

In an effort to bolster consumer confidence, Obama planned to announce government backing of warranties for GM and Chrysler vehicles. An administration official said there is no price tag yet associated with that promise.

Aides note that Obama inherited the auto mess from his predecessor, President George W. Bush.

Under the terms of a loan agreement reached during the last administration, GM and Chrysler are pushing the United Auto Workers to accept shares of stock in exchange for half of the payments into a union-run trust fund for retiree health care. They also want labor costs from the union to be competitive with Japanese automakers with U.S. operations.

Little progress has been made between the companies and the union.

Atleast i got my HHR. If they go under i really don't wanna see what will happen to the economy.