GM’s Wagoner resigns at White House request

By Ed Brayton 3/29/09 6:09 PM

In a huge and unexpected move, General Motors (NYSE:GM) CEO Rick Wagoner has agreed to step down from his position at the request of the Obama administration. AP reports:

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…

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.

All indications are that the auto task force is going to demand deeper concessions and more significant reforms as a condition of a second round of government funds than the Bush administration did for the first round of funds in December.

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Rayne1

This is one of those pieces where editorial team and team members may have a disagreement. Perhaps people outside of the automotive industry would view Wagoner's exit as a surprise, but with bondholders continuing to make noises about unfairness of concessions they were being asked to make at this late juncture, there was sure to be at least one human sacrifice.

And there will be more; changes are expected on the board of directors at GM.

The bigger unknown ahead is Chrysler — what can we expected of a privately-held company cloaked in the amount of secrecy which accompanies subsidiaries of Cerberus? Will we see similar human sacrifices, or will the current management remain intact because Cerberus is likely Chrysler's largest debt-holder?

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GM’s Wagoner resigns at White House request