OBAMA Sacks Head GM America.

[csv8]

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 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 plans 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.

Wagoner's departure indicates that more management changes may be part of the deal. Wagoner, 56, has repeatedly said he felt it was better for the company if he led it through the crisis, but he has faced sharp criticism on Capitol Hill for what many lawmakers regard as years of missteps, mistakes and arrogance by the Big 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.

Obama said Sunday that GM and Chrysler and all those with a stake in their survival need to take more hard steps to help the struggling automakers restructure for the future. 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.

"They're not there yet," he said.

A person familiar with Obama's plans said last week they would go deeper than what the Bush administration demanded when it approved the initial loans last year.

Wagoner, in an interview with The Associated Press in December, had 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)."

Wagoner has been credited by auto industry analysts with doing more to restructure the giant, bureaucratic 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 far too slowly to take on the United Auto Workers and shrink the company as its market share tumbled.

While GM has improved its cars in the last two years, critics say the company 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.

He 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.

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[Wretched]

GM and Chrysler do need a re structure but I don't think the Government should have any right to sack a CEO. That should be up to the board members and shareholders.

[Jason[98.EL]]

What sort of implications will this have on GMH here in aus

it doesn't sound to promising it could lead to the end of Holden here.

just my 2c worth

Jason

[XplosiveR6]

Originally Posted by Wretched

GM and Chrysler do need a re structure but I don't think the Government should have any right to sack a CEO. That should be up to the board members and shareholders.

When the Government are the ones keeping these companies alive with their cash of course they have the right to sack the CEO's.

[Gaz]

They aren't 'sacking' him as such. They are offering a choice, continue as is - or - if you want money from us then get rid of that guy and we will give it to you.

The decision is made by GM and its board.

Fair enough call.

[imugli]

Originally Posted by XplosiveR6

When the Government are the ones keeping these companies alive with their cash of course they have the right to sack the CEO's.

Couldn't agree more.

[Dave_au]

Originally Posted by Wretched

GM and Chrysler do need a re structure but I don't think the Government should have any right to sack a CEO. That should be up to the board members and shareholders.

Actually this happens more often than you think; lenders such as banks and other large creditors do have the ability to force a change of management simply by refusing to re-new or lend a crucial loan in the first place.

[scradley_6666]

The government lives off my taxes... can i sack Kevin??
Jokes, Obama doing the right thing again and not afraid to do the hard work...

[Wretched]

Originally Posted by XplosiveR6

When the Government are the ones keeping these companies alive with their cash of course they have the right to sack the CEO's.

Does that set a precedence for the other companies asking for bailouts?
Rick should have went long time a go but I don't agree the President with little or no understanding of the industry should be able to do that.

Might GM become the new British Leyland?

[Ghiadude]

Notice how ford isnt mentioned other than the implied "Big Three"

[vztrt]

Originally Posted by scradley_6666

The government lives off my taxes... can i sack Kevin??
Jokes, Obama doing the right thing again and not afraid to do the hard work...

Just need to be careful when 'doing the right thing' may force GM, Chrysler on getting rid of large capacity engines.

[Bundy]

Originally Posted by Wretched

GM and Chrysler do need a re structure but I don't think the Government should have any right to sack a CEO. That should be up to the board members and shareholders.

I think at this stage "$17.4 billion in government aid and have requested $21.6 billion more." makes the man in the white house and the rest of the US population, a pretty big shareholder.

Heads should roll, literary, in all their greedy institutions!

[Cobra]

Originally Posted by Wretched

Does that set a precedence for the other companies asking for bailouts?
Rick should have went long time a go but I don't agree the President with little or no understanding of the industry should be able to do that.

Might GM become the new British Leyland?

The president doesn't make decisions, he rubber stamps them for the most part. Do you not think he has at least one adviser that may have industry knowlege? I am sure that the US government have done their homework and are making the right decision.

[chevypower]

Will it be 4 or 8 more years of socialism?

[DJR-351]

If he does go, i would be interested to see how much the "Golden Handshake" is worth....

[imugli]

Originally Posted by Wretched

Does that set a precedence for the other companies asking for bailouts?
Rick should have went long time a go but I don't agree the President with little or no understanding of the industry should be able to do that.

Might GM become the new British Leyland?

I hope it does.

I am against bailouts. Period. But if the government is going to be susidising these companies that would otherwise fail yes, they should call the shots and they should get rid of a lot more of the CEOs if they are the ones that presided over the actions that lead to this.

Only problem with this is that govts are notoriously BAD at running businesses, thus we have capitalism, thus I don't believe in the bailouts. Let them fall, I say.

[uranium_death]

Originally Posted by tx3dude

Notice how ford isnt mentioned other than the implied "Big Three"

The article isn't positive. I think it's good that Ford isn't explicitly stated.
It names Chrysler and GM and states how they're dependent on dole money from the government.

Public perception is everything in the automotive world.

To mention Ford in an article that basically alludes to the fact that the US' motor industry is up the creek without a paddle may potentially lead people further away from these companies.

It's known fact now that Ford is managing their own affairs, and not dependent on the US government to stay alive.

Just my observation anyhow.

[imugli]

Originally Posted by uranium_death

I think it's good that Ford isn't explicitly stated.

I think that's what he was implying.

[GT0132]

Originally Posted by XplosiveR6

When the Government are the ones keeping these companies alive with their cash of course they have the right to sack the CEO's.

What he said....

[GT0132]

[QUOTE=Wretched]Does that set a precedence for the other companies asking for bailouts?
Rick should have went long time a go but I don't agree the President with little or no understanding of the industry should be able to do that.

QUOTE]

I think so.....If you owned a business, and were in the CEO/MD role and fell on hard times and came to me for financial support (otherwise failure imminent) I'd support you provided that (1) I saw your business had a promising future and (2) I had a 51% equity stake in your business including board voting rights.

If you stuffed up I'd exercise my voting rights to fire you and get a good manager in your place to protect my investment. Irrelevant whether I know the industry your business is in or not...My new manager will look after all that operational stuff for me once you're gone.

[Fordman1]

Originally Posted by chevypower

Will it be 4 or 8 more years of socialism?

Ask the many thousands of American families whose futures depend on what decisions the administration makes "now".

I laugh whenever I hear American's crying "Socialist", "Left winger", etc.

It's a pity many over there can't see the positives that "some" government "help" (eg: Healthcare) would do for the average middle class American.

[Steve]

Originally Posted by Cobra

The president doesn't make decisions, he rubber stamps them for the most part. Do you not think he has at least one adviser that may have industry knowlege? I am sure that the US government have done their homework and are making the right decision.

Let's just hope that this so called adviser has a good knowledge of the car industry and of business. Unlike the farce of Steve Bracks having been appointed to advise on the future of the Australian car industry.

[chevypower]

Sure, I don't think EVERY Obama policy is a bad one, but I do think he wants too much control on things. Kind of like a dictator. Only now, the lines seem to be blurring between a dictator and a conservative republican.
The thing about the American car companies, that people forget, is they are not very efficient, but they employ a heck of a lot more people than overseas competitors, which sell less cars, but keep expenses down by having fewer brands and employing less people. Eg. Toyota has less than 2000 dealers, Ford has 4000, and GM, having 7 brands, has about 7000 dealerships... then the marketing and management staff and budget to operate 7 different brands, plus everyone else. GM relied on a lot of sales to make that work, but many people benefited from it. With today's economy, GM has to cut back on jobs and consolidate brands. But even that transition costs a lot of money. GM spent over $1Billion just closing Oldsmobile. Obama can't just be a Donald Trump and fire every CEO to fix these problems. Next, Obama will be designing the cars, naming them, and arranging the production specs.

So, this isn't about Healthcare, it's about governments doing what they should be doing, by assisting, but not controlling. In healthcare terms, it would be like Obama prescribing you medications to take, which doctor you must see, etc etc...

[Wally]

Wagoner gone = about bleeding time.

[Fordman1]

Originally Posted by chevypower

Next, Obama will be designing the cars, naming them, and arranging the production specs.

You don't really believe that do you ?

If GM and Chrysler Fail, watch the fall out !!

BTW: Obama has "people" that give him the options to consider, he rubber stamps the ones that are pushed forward as the best ones....

The Obama Conspiracy hey ?

I think you're a believer in that.......

[LeadFoot81]

Im glad Ford weren't mentioned (negatively) in the article, but it would've been nice to read that the company is manging its own affairs, rather than depending on the govt.

[chevypower]

Originally Posted by Barraxr8

You don't really believe that do you ?

If GM and Chrysler Fail, watch the fall out !!

BTW: Obama has "people" that give him the options to consider, he rubber stamps the ones that are pushed forward as the best ones....

The Obama Conspiracy hey ?

I think you're a believer in that.......

LOL, I was joking a little bit.... but I do believe he will put tougher restrictions on what they can and can't do, so really, GM will have it's designers... as long as it looks like something Obama would approve of. I think Obama is trying to do the right thing, but look at what has happened. They have a corporation which has massive overheads (which I mentioned before), demand for new cars goes right down, oil prices go all over the place, every politician is talking about new energy policies. One week you hear Natural Gas, the next week it's hybrids, the week after that it's hydrogen. Obama keeps talking about biodiesel and ethanol, and not everyone's on the same page with that. Nobody really knows where it's going. People are saying these CEOs should have been on to this 5 years ago... What, when V8 SUVs were selling like hotcakes? People weren't even interested in talking about "Who Killed The Electric Car" until oil was approaching $100/brl. There really is no alternative energy policy. Now you have Obama saying "wake up Big 3, all you CEOs are going to be fired!" Where's the incentive to become a CEO and try to do good for a company like that? As I mentioned, it cost $1B to close Olds, it would probably similar to close Saturn, and more to close each of the other brands, as there are more franchisees. I think GM will eventually get it down to Chev, Buick and Cadillac, but it's going to be pretty tough for them. Obama might appeal to the middle class, but without the top, there really is no middle, they would all be on the street without a job.
One thing's for sure, he's already killing the aviation industry.

[Wally]

The fact is, that GM and the USA for that matter has been running itself into the ground for too long, trying to make a profit in me too business'.

Obama has inherited a poisoned chalice, but that also gives him plenty of room to move America out of loungeroom and back into the game. Nothing gets the pulses raising harder than blood on the boardroom table.

You can blame the smarty pants who ignored Napolean's warning about China:- "Let her sleep, for when she wakes she will shake the world"

[steamin63]

Originally Posted by chevypower

Will it be 4 or 8 more years of socialism?

why not. we have all seen what 8 years of fascism, sorry capitalism has done to the US and the rest of the world.

[Fordman1]

Originally Posted by chevypower

Will it be 4 or 8 more years of socialism?

Just like the UK, France, Italy, Germany, and Australia ?