The White House has forced out General Motors chief Rick Wagoner as part for a more aggressive restructuring of the beleaguered automaker than the company has proposed, the Wall Street Journal reports. The Treasury threatened to withhold billions in federal loans if the chairman and CEO refused to step down. The surprise move came a day before President Obama unveils a new $21.6 billion auto bailout plan today. COO Frederick "Fritz" Henderson will step in temporarily for Wagoner.
Obama will exert further pressure on Chrysler as well as GM, demanding "a set of sacrifices from all parties involved—management, labor, shareholders, creditors, suppliers, dealers," he said yesterday. Both will receive additional aid and deadline extensions—GM for 60 days, Chrysler for 30—for working out their restructuring plans, which could include short-term bankruptcy. A White House official said Chrysler chief Robert Nardelli will likely keep his job as the company irons out an alliance with Fiat.