Rick Wagoner has been forced to step down as General Motors chairman and CEO by US President Barack Obama, as a condition of the beleaguered automaker continuing to receive state aid.
Wagoner was meeting with US government officials on Friday when the request was made for him to ‘step aside’. Wagoner had been GM president and CEO since 2000, and chairman since 2003 – his resignation ends a 31-year career with a company.
Fritz Henderson, current GM president and chief operating officer, will now serve as CEO. Kent Kresa, a GM director since 2003, will take over as non-executive chairman. Kresa has already confirmed that more changes will occur at GM, declaring that by the company’s next annual meeting there will be ‘a majority of new directors’.
Now that Wagoner has stepped down, GM is to be given another 60 days to refine its survival plan – the Obama auto task force has admitted GM’s current recovery plan isn’t viable. In the meantime, GM is expected to receive an unspecified amount of additional government aid.
The extension proves that the Obama administration believes GM can be a viable business, while it has declared that Chrysler has just 30 days to form a tie-up with Fiat – the Obama administration doesn’t believe Chrysler is a viable stand-alone operation. If Chrysler and Fiat can form a tie-up, and meet a number of guarantees, the partnership will be eligible to receive a further $6bn in aid. If not, Chrysler could be forced into bankruptcy, along with GM if the US government rejects its new survival plan.
Barack Obama will outline his plan for the recovery of the US auto industry later today.
Rick Wagoner’s resignation statement is available in full below:
On Friday I was in Washington for a meeting with Administration officials. In the course of that meeting, they requested that I “step aside” as CEO of GM, and so I have.
Fritz Henderson is an excellent choice to be the next CEO of GM. Having worked closely with Fritz for many years, I know that he is the ideal person to lead the company through the completion of our restructuring efforts. His knowledge of the global industry and the company are exceptional, and he has the intellect, energy, and support among GM’ers worldwide to succeed. I wish him well, and I stand ready to support him, and interim Non-Executive Chairman Kent Kresa, in every way possible.
I also want to extend my sincerest thanks to everyone who supported GM and me during my time as CEO. I deeply appreciate the excellent counsel and commitment of the GM Board and the strong support of our many partners including our terrific dealers, suppliers, and community leaders. I am grateful as well to the union leaders with whom I have had the chance to work closely to implement numerous tough but necessary restructuring agreements.
Most important of all I want to express my deepest appreciation to the extraordinary team of GM employees around the world. You have been a tremendous source of inspiration and pride to me, and I will be forever grateful for the courage and commitment you have shown as we have confronted the unprecedented challenges of the past few years. GM is a great company with a storied history. Ignore the doubters because I know it is also a company with a great future.