Rick Wagoner, GM CEO, Will Step Down At Obama's Behest

UPDATE:

The Obama administration asked GM CEO Rick Wagoner to step down, according to numerous reports.

According to Politico:

The Obama administration asked Rick Wagoner, the chairman and CEO of General Motors, to step down and he agreed, a White House official said.

The White House confirmed Wagoner was leaving at the government's behest after The Associated Press reported his immediate departure, without giving a reason.

And the Wall Street Journal adds more details:

Mr. Wagoner was asked to step down on Friday by Steven Rattner, the investment banker picked last month by the administration to lead the Treasury Department's auto-industry task force. Mr. Rattner broke the news to Mr. Wagoner in person at his office at Treasury, according to an administration official. Afterward, Mr. Rattner met one-on-one with Mr. Henderson, who will fill in as GM's CEO.

"On Friday I was in Washington for a meeting with administration officials," Mr. Wagoner said in a statement released by GM. "In the course of that meeting, they requested that I 'step aside' as CEO of GM, and so I have."

**************************************

General Motors CEO Rick Wagoner will step down from the company, according to several reports.

The timing is curious, considering that President Obama is expected to announce on Monday the next steps to help GM and Chrysler, which have received $17.4 billion in emergency funding from the U.S. Treasury and are asking for more help: G.M. has asked for up to $16.6 billion more, and Chrysler another $5 billion. On Friday, Wagoner was in Washington, DC to meet with the White House auto task force, led by former investment banker Steve Rattner.

Wagoner and GM have been criticized for not doing enough to slash debt and cut costs as part of the giant automaker's agreement with the government.

CNBC first reported that Wagoner would step down, adding that GM did not confirm or deny the report.

The New York Times reports:

The unexpected move by Mr. Wagoner, who has been at the helm of G.M. for eight years, was not confirmed by the company. But a statement about Mr. Wagoner's future will be issued after the president's address...

There was no indication yet who would take over the top job at General Motors. As recently as March 18, Mr. Wagoner said in an interview that he had no indication that his job was in jeopardy because of the task force.

Though there was no word on who would replace Wagoner, GM's COO Fritz Henderson, is widely expected as the leading candidate to replace him.

Some former critics of Wagoner were surprised that the administration decided to force him out, rather than bank executives who have received billions in bailout funds.

Reuters reports:

University of Maryland economist Peter Morici, a one-time critic of Wagoner who had called for him to resign but now believes he had "started to get it," said the administration has a "PR problem" regarding unpopular corporate bailouts.

"They are bailing out just about anybody that shows up and says they need cash. The public has grown weary of it and instead of throwing a banker to the wolves they have decided to throw Wagoner to the wolves," Morici said.

Congressman Thaddeus McCotter, a Detroit-area Republican and member of the House Financial Services Committee, was critical of the White House decision, claiming that Wagoner was a victim of a double standard:

"Mr. Wagoner has been asked to resign as a political offering despite his having led GM's painful restructuring to date. Mr. Wagoner has honorably resigned for the sake of his company's working families.

When will the Wall Street CEOs receiving TARP funds summon the honor to resign? Will this White House ever bother to raise the issue? I doubt it."

Amid increasing accusations of a double standard in the treatment of the auto industry compared to banks, the Wall Street Journal is reporting that White House officials considered ousting Citigroup CEO Vikram Pandit in the past:

Since the financial crisis bloomed in September, the Bush and Obama administrations have replaced management only in cases when they took control of struggling companies, such as mortgage giants Fannie Mae and Freddie Mac and insurance concern American International Group Inc.

Citigroup Inc., by contrast, has received three government rescues since October, under which the U.S. will own up to 36% of the company's stock. Officials have in the past considered removing CEO Vikram Pandit, but demurred, in part because of the paucity of candidates to replace him, people familiar with the matter say. A spokesman for Citigroup couldn't be immediately reached for comment.

Comments

[dontvote4him]

03:28 PM on 04/01/2009

GM is now OM.

[igorz]

12:42 PM on 04/01/2009

So, what do you call a bus full of lawyers with one empty seat that drives off of a cliff? A wasted opportunity.

So what do you call a bus full of lawyers with no empty seats that drives off of a cliff? A start.

Rick Wagoner is like that...a start.

[mamacat]

06:10 AM on 04/01/2009

Why was Wagoner allowed to pay himself a $20 million severance package with taxpayer money? Wouldn't GM have folded by now without taxpayer bailout money? Isn't this another case of gross misconduct by a management figure who drove his company into a ditch?

[petef59]

11:03 PM on 03/31/2009

No one gave a damn when my union contract was broken,ignored on a weekly basis for the last 8 years. Contracts (law) that affect safety, health and personal progress (ablity to attend classes-while working 40 hour week instead of forced 50-56hr).

[petef59]

10:46 PM on 03/31/2009

Bye-bye. This guy wanted to dump Saturn. I have a 2002 SL which gets 30 MPG city/41 HWY. Great car, no mecahnical troubles,just change oil, air filter ocassionally and new tires and battery at 55K miles. And with Air, moonroof, cd/radio, aluminum wheels the damn thing only cost $12,800.
My local Honda dealership did not have a Civic Hx model I wanted. The Hx got 36city/41 hWY. Salesman said he'd check regional inventory, but never called back.
A Toyota salesman screwed me on contract/payment figures (lied and changed numbers after I signed contract). They make great cars, but even their regional customer service blew me off.
Is it just US salesman and dealerships that have contempt for customers?

[BoSoxFanNC1]

06:58 PM on 03/31/2009

And so it begins....BIG Government determining who can run BIG companies

Maybe Obama should send Barney Frank over there to run it..."There is nothing wrong with GM"

[igorz]

12:46 PM on 04/01/2009

You'd prefer, maybe, the Republicans who ran this nation into the ditch? Fact is, the whole lot of them Auto execs, bank execs and the Republicans who enabled them need to be removed from America...preferably Gitmo but we'll settle for a good old American prison instead

[amerima]

02:24 PM on 04/01/2009

Does the word "Constitution" ring a bell to ANYONE? Since when can the president fire someone just because they took tax dollars. Well, that would mean all hospitals, all school systems, any area of business that has been helped by tax dollars! That would really include EVERYTHING!!!!! The executive and legislatives branches have been blurred and crossed. Big government is calling all the shots while shooting holes in the CONSTITUTION. All those rights and privileges you love-apply to all; including Wagoner. Now it is a crime to have money? Don't worry, none of us will, after we pay our taxes!!! Just remember Thomas Jefferson, "Any government big enough to give you what you want is big enough to take everything you have".

[dontvote4him]

03:32 PM on 04/01/2009

Barney can turn the salesmen into his personal man servants.

[FrankensteinBlack]

03:27 PM on 03/31/2009

GM Rick, you deserved to be fired! Not only should we have had an EV-2, 3, 4 by now but you let those oil golf pals of yours drive, er ruin your business! At the HEIGHT of high gas prices you continued to run 10 to 1 commercials in favor of gas guzzlers. And now you come running to us for tax payer bail out, wondering what happened? Why not go to your oil pals first? Well, GOOD RIDDANCE!

PS Oh yea, thanks Prez BHO for finally stepping up and giving the smack down to an antiquated fool. Now the company and its employees can shed eight years of big oil motivated arrested development and retool for a greener, oil free automotive future. So, which Jurassic CEO is next on the hit parade?

I said to a friend that this could turn into the Urkel Presidency. Please prove me wrong!!

[Akat1973]

09:42 AM on 03/31/2009

Just for you people who want to know why, or how Obama forced someone to leave their job,Im going to go with the lawyer on this one- Has anyone stopped to think maybe something was uncovered that could have been illegal in regards to the Wagoner? Maybe it was one of those you can resign now,or face charges? anyone but me thought about this? Obama had to know or have something pretty powerful to make the head of GM resign
food for thought.

[Akat1973]

09:38 AM on 03/31/2009

I know allot of people who liked it better when they didnt know what Bush-Cheney was dong during their horrid 8year car-crash of an administration.The truth is if we would have had even a slight bit of transparency within that republican dictatorship we would have been horrified even more than we already are!(except the blind sheep of course) Obama is telling us the hard brutal honest truth. If these CEO'S are asking the American people for money and if they have run their companies into the ground,than bye bye.......time for some New Vision.
I agree with eye patch

[SayByeToTheConstitution]

02:01 AM on 03/31/2009

Um, however bad we think GM's management might be, please, can someone show me where in the Constitution the government is empowered to basically fire the CEO of a private company?

I'll accept something you can find in the Federalists Papers if you like.

You'll not find anything...you know why?....because it is isn't there.

Folks, we are fast becoming a one party country attempting to control opposition and pretty much everything else.

[biabouman41]

09:05 AM on 03/31/2009

Yeah< i can show you something, I think it is actually older than the Federalists Papers: He who pays the piper, calls the tune. Why should we the taxpayers pay all this money to bailout these companies and our representatives have no power??

[petef59]

10:50 PM on 03/31/2009

KInd of like when Mutual Fund co's Boards are all corporate buddies and pay huge bonuses to their friends while losing your money. Or the same with stockholders money. And they listened to shareholders,right?

[amerima]

03:31 PM on 04/01/2009

Our representatives have no power? It was deregulation that allowed all of this to occur! It was the Oversight Committees in our own Congress that allowed the corruption to take place. Barney Frank, Chris Dodd, Maxine Waters all worked to make sure all their Oversight Com. did its job!! Well, they did one hell of a job!! Look where we are! And each of them says they were totally unaware of ANY problem. Maxine's husband is on one of the bank's board and Barney's significant other worked for Freddie Mac. And Chris Dodd got himself a sweet new mortgage with a fantastic rate, not allowed to the general public. Poor reps in Congress- having no power! You need to read about this so-called Oversight Com. They had their sights over all that green to line their pockets!

[petef59]

10:52 PM on 03/31/2009

government of, for, and by THE PEOPLE.

[JonAmmendall]

12:22 AM on 03/31/2009

Obama said he was going to save 2 of the 3 American Automakers, GM and Chrysler. My hats off to Ford for standing up an not taking money from the Washington Maffia.

[devildidit]

11:11 PM on 03/30/2009

WHAT'S WITH THE DOUBLE STANDARD? I SUPPORTED OBAMA FOR PRESIDENT BUT HIS
ACTIONS ARE GIVING ME SECOND THOUGHTS. WHY ASK GM HEAD MAN TO STEP ASIDE AND
NOT THOSE ON WALL STREET THAT BROUGHT THIS COUNTRY INTO THIS MESS. WHAT GIVES?

[SayByeToTheConstitution]

02:02 AM on 03/31/2009

He's not empowered to oust anyone from a private company.

[petef59]

10:57 PM on 03/31/2009

I believe the FBI has hundreds of investigations in progress regarding Wall Street,rating agencies,banks and isnurance companies. Patience.

[oregonideas]

08:23 PM on 03/30/2009

It looks like Ricky will walk away with something like twenty-three million dollars is severence package. I'd be willing to be as enept as him for half of that. Here's a man who braggs that he is the face of GM and his departure will hurt the value of the company. Actually he's right.....he is the face of the failed GM company and his departure will cost GM that twenty-three mill.; which is probably more than the actual net value of the company.

CEO's are quick to take credit for company's success and very, very slow to accept any blame for failures. When companies falter cost savings start at the bottom, as far away from those who made the bad decisions as possible. Let's lay off line workers, custodians, maintenance people, secretarial staff, etc, etc; but please don't dare to look at upper level administration.. odd, how every thing positive is "trickle down" and "bad news" (like pink slips) start at the bottom.

The Obama administration is to be congratulated for letting the auto industry know that "more of the same" (but with taxpayers' money) isn't going to happen.

[cadd]

06:51 PM on 03/31/2009

Rick should walk away with twenty million dollars. It's not a severence package. It's his retirment fund that he has paid into and worked hard for over the last 31 yrs.

Even though he might not have been the man for the GM CEO job, there is no way Obama should have had that power to let him go, it should have been up to the GM board. Not our president who is trying to become a dictator.

I do agree, we should start at the top of the upper level administration. Starting with Obama and his administration. They want to start caping salaries and everyone has to make sacrifices, well let them be the prime example. Start with cutting their own salary. Everyone and everything is being touched except for the White House. They need to come down off their hy-horse and stop trying to be a dictator and start doing what's right for the American people!

[eyepatch]

06:43 PM on 03/30/2009

I can understand the Obama adminstration asking
Rick Wagoner to step down, because it seems like
the US Auto makers don't understand that their product
choices are not helping draw interest in their product!

Case in point: When the Chevy Volt was introduced GM
brought out this snazzy looking proto-type, excitement
for the vehicle had been created about a futuristic looking
green car to be sold, but what is GM producing???
a sedan that looks like a Chevy Lumina that has a different power plant!

The public was expecting to buy the prototype but GM gave
them same cars that people have been rejecting for years!
Also, why are they still producing these gas guzzling SUV's???
you can drive by a GM dealership and thats all you see in the lots....

It's hard to help a company like GM when they can't be visionaries
and are stuck in the same mindset that bankrupted the company!!!

Somone had to go and Mr Wagoner was the logical choice!!!!!!!

[othel]

06:15 PM on 03/30/2009

Wagoner was an incompetent woos.
Another indication of how far the private enterprise system in this country has fallen when politicians have to show companies how to deal with top management people who can't get it done. GM's entire board of directors should be next.