h1GM BOSS ORDERED TO QUIT/h1
Rick Wagoner given the boot by Obama
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General Motors CEO Rick Wagoner has stepped down as boss of the struggling car giant at the request of the US government car industry aid taskforce.
Wagoner, who has been boss of GM for over eight years, will be replaced by Chief Operating Officer Fritz Henderson who will now have 60 days to prove to the task force the future viability of the company.
Full details of the advisory board's findings will be announced by President Obama later today, when further details on future staggered loan payments will be given. Both GM and Chrysler are desperately seeking the next instalment of government aid, but will have to prove their long term viability if they are to receive the cash.
Henderson will now have to steer the company through a tricky two months that could result in the company being placed into Chapter 11 bankruptcy if things can’t be turned around.
Fellow strugglers Chrysler are expected to be given 30 days in order to complete the proposed merger with Fiat, a deal which will provide the company with access to Fiat platforms, and save the company billions of dollars in development costs. If the alliance is successful the US government is likely to grant Chrysler a further $6bn in state support.
Both companies have said they need further funds urgently to survive the coming month. GM has previously said it would not survive beyond the start of April unless it were to receive over £2bn in support, while Chrysler could suffer a serious cash crisis unless the next loan instalment was forthcoming.
Author: George B