BUZZ: Wagoner steps down

In an interview with US broadcaster CBS this morning our time, President Barack Obama expressed his desire for a 'leaner, meaner' auto industry - one that apparently has no room for General Motors' Chairman and CEO of six years, Rick Wagoner.

Obama said the success of the local industry depends on a redesign that will get the companies through the current crisis and 'emerge - at the other end - much more lean, mean, and competitive than it currently is.'

And apparently, this redesign starts at the top of the powertrain.

Wagoner, who has headed GM since 2003 and been with the company for 31 years, apparently agreed to step down 'at the request of the White House', according to US government officials.

His resignation precedes tomorrow's deadline (Monday USA time) for the government's future plans for GM and fellow car giant, Chrysler.

The two carmakers have already received US$17.4billion in taxpayer-funded bail-outs, with Chrysler still coming up US$5billion short, and GM needing a whopping $16.7billion more.

The next step of the Detroit rescue plan relies on concessions from the unions and creditors, as well as reducing worker numbers in exchange for the bailout money. GM and Chrysler employ about 140,000 US workers. GM plans to axe 47,000 of these jobs, while Chrysler will cut 3,000, and both will continue to downscale their model line-ups.

"There's been some serious efforts to deal with a combination of long-standing problems in the auto industry and the current crisis," the President said on CBS talk show Face the Nation.

"What we're trying to let them know is that we want to have a successful auto industry, U.S. auto industry. 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.

"They're not there yet.

"Everybody's gonna have to come to the table and say, 'It's important for us to take serious restructuring steps now in order to preserve a brighter future down the road."

GM and Wagoner have not officially confirmed the resignation as yet. Stay tuned...

FOR RELEASE: 2009-03-29
GM Statement on U.S. Auto Industry Restructuring Announcement

We are anticipating an announcement soon from the Administration regarding the restructuring of the U.S. auto industry. We continue to work closely with members of the Task Force and it would not be appropriate for us to speculate on the content of any announcement.