There are reports today from the US that the Chairman and Chief Executive of General Motors (GM), Rick Wagoner, resigned on Sunday. His resignation was part of a broad agreement with the Obama Administration to funnel more government aid to the GM. Mr Wagoner, who has served as GM’s top executive since 2000, agreed to step down after it was requested by the President’s auto task force.

There are further reports that the President’s task force is expected to recommend more short-term aid for GM and Chrysler, but with tight strings on the money and a deadline on getting concessions from union workers and creditors. GM and Chrysler have almost exhausted the US$17.4 billion in Federal aid the two companies have received since December. GM has asked for up to an additional US$16.6 billion, and Chrysler has requested an additional US$5 billion. It is thought that without Federal assistance, GM may have to file for Chapter 11 Bankruptcy because the Banks are unwilling to loan the money needed by GM and Chrysler.

 Mr Wagoner’s decision to resign from GM would not necessarily have any affect on the operations of GM’s wholly owned subsidiary in Australia, General Motors Holden Ltd.
 

Source: HWL Ebsworth e-News: Automotive Industry Group