Engine Of Democracy

GM Chief to Resign at White House's Behest
Obama Pushes General Motors and Chrysler to Slim Down, Make More Concessions

Chrysler gets 30 days to complete Fiat deal, GM 60 days to restructure

Christine Tierney and David Shepardson / The Detroit News

In a dramatic development on the day before President Barack Obama was to unveil his plan for the auto industry, General Motors Corp. Chairman and CEO Rick Wagoner stepped down after the administration asked him to resign.

Obama has said he wants to help the U.S. auto industry and is offering GM and Chrysler LLC fresh short-term aid, but he faces mounting public opposition to industry bailouts.

"From the government's perspective, they had to show a visible form of sacrifice," said David Cole, chairman of the Center for Automotive Research in Ann Arbor and the son of a former GM president. "At one level I'm surprised, and at another level, not at all."

GM confirmed the management change just after midnight and Wagoner released a statement."Fritz Henderson is an excellent choice to be the next CEO of GM," Wagoner said. "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."

Henderson, 50, a GM veteran who has led the automaker's European and Chinese operations, has been carrying out the company's restructuring on a day-to-day basis and knows the leaders of Obama's auto task force.

GM also said that Kent Kresa, chairman emeritus of Northrop Grumman Corp., had been named interim non-executive chairman of the board of directors. Kresa became a GM director in 2003.

Wagoner, 56, was a GM lifer who became the company's CEO in 2000 and chairman in 2003.

Industry experts credit Wagoner with pushing through reforms and a landmark labor contract at the 100-year-old automaker, but he may have moved too slowly.

"If you can criticize Rick, it's that he was incremental by nature," said Jeremy Anwyl, chief executive officer for the automotive research site Edmunds.com. "Step by step they were moving forward but they ran out of time."

After losing $82 billion since 2004, GM is subsisting on federal loans as it struggles through one of the most perilous stretches in its history. It has received $13.4 billion from the government and sought up to $16.6 billion more.

The government said late Sunday it will provide GM with an unspecified amount of working capital over the next 60 days.

There will be no immediate management changes at Chrysler, which will receive aid for 30 days as it moves to conclude an alliance with Italy's Fiat SpA.

Obama is scheduled to publicly outline his strategy for the American auto industry today in Washington.

In his statement, Wagoner said he was asked to step down during a meeting Friday at the U.S. Treasury Department.

"I think the need for something symbolic was pretty strong, and this certainly qualifies," Anwyl said.

In its assessment of GM's restructuring plan submitted on Feb. 17, the task force concluded that the plan was not viable, that GM needed a change of leadership, including changing most of the directors on its board.

It also said GM's plans did not go far enough, and it still has too many nameplates. It also said that while the Chevrolet Volt extended-range electric vehicle looks promising, it will probably be too expensive to be commercially successful initially.

Wagoner, who had agreed to work for $1 a year, is barred from getting a golden parachute or a big severance package under the terms of the government's Troubled Asset Recovery Program.

Earlier on Sunday, on one of the morning news shows, Obama said he believed the U.S. auto sector could be restructured to become a successful industry.

"But it's got to be one that's realistically designed to weather this storm and to emerge at the other end much more lean and mean and competitive than it currently is," he said on CBS's "Face the Nation." "And that's going to mean a set of sacrifices from all parties -- management, labor, shareholders, creditors, suppliers, dealers." ..More

WASHINGTON -- The top advisers for President Barack Obama's auto task force will have a chance today to literally kick the tires on Detroit's struggling automakers before deciding how much federal aid they're worth.

The visit, spurred by invitations from the automakers, will cap two weeks of intensive research by the presidential task force into all aspects of the U.S. auto industry as it suffers the worst slump in four decades. After today's trip, the Obama administration has only days to address warnings from General Motors Corp. and Chrysler LLC of imminent bankruptcy and collapse without at least $7 billion in aid by the end of the month -- $5 billion for Chrysler and $2 billion for GM....More

Buy Auto Domain Names-AutoTaskForce.Com-Website

Dec. 19 (Bloomberg) -- General Motors Corp. and Chrysler LLC will get $13.4 billion in initial government loans to keep operating in exchange for a restructuring under a rescue plan announced by President George W. Bush.

A bankruptcy is unlikely to work for the automakers at this time and can’t be allowed, Bush said at the White House.

“These are not ordinary circumstances,” Bush said. “In the midst of a financial crisis and a recession, allowing the U.S. auto industry to collapse is not a responsible course of action.”

The money will be drawn from the Troubled Asset Relief Program and the automakers will get an additional $4 billion from the fund in February for a total of $17.4 billion in assistance, according to a statement from the Bush administration. The funds would allow GM and Chrysler to keep operating until March.

Winning the assistance is a reprieve for GM, the biggest U.S. automaker, and No. 3 Chrysler after they said they would run out of operating funds as soon as this month. Bush is stepping in after Senate Republicans’ refusal last week to take up a House-approved rescue raised the prospect of a company failure costing millions of jobs.
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Automotive News

WASHINGTON -- The Bush administration, signaling a possible shift in policy, will consider using money set aside for the rescue of financial institutions to make emergency loans to automakers, the White House said this morning.

The word comes in the aftermath of stunning rejection by the Senate last night of legislation to provide $14 billion in emergency loans to prevent the collapse of General Motors and Chrysler LLC.

President Bush and his appointees have resisted using any of $700 billion approved in October for financial institutions to provide industry help under the Troubled Asset Relief Program, or TARP. Democrats contend the failure of one or more automakers would have widespread devastating economic effects.

It's unclear when the White House or U.S. Treasury will make a decision about using TARP funds for the auto bailout.

Of the first $350 billion in the TARP fund, about $15 billion has not yet been committed, wire services reported this morning.

That happens to be the amount GM and Chrysler say they need to survive to the end of the first quarter of 2009.

To access the second $350 billion, the administration must seek fresh approval from Congress.

U.S. Sen. Carl Levin, D-Mich., said the effort to provide the emergency bridge loans remains "very much alive."

"I am encouraged that the White House said today that they will consider other options to assist the auto companies, including use of the TARP program," Levin said in a statement.

"Use of TARP funds is the fastest, most feasible, most immediate and most certain approach to provide the emergency bridge loans needed by the auto companies.

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Yes, now we know how little the rest of America cares for Detroit, Michigan and The America Auto Industry! We have been beat up time and time again by the US media and international media, but never did i think Americans of the South and West hated us so much.

What is more important for Detroit and Michigan is that we remember who we are! We are the salt of the earth hard working people, we are the people that built the tanks and planes that crushed the Nazi regime from taking over the world, we have made the vehicles and engines that have been used to advance our society.

We may dwindle and fade from our glory years, but with the right vision we will rise again.

We must begin a new era of renewed commitment of quality, efficiency and innovation.
We should not strive to be on par with the Japanese automakers, we need to beat them in every aspect of the game.

A large part of their success is because the Japanese Government fully backs the Japanese Autos! We need the legislation in place to make it more difficult for Japanese and foreign transplants to use our tax dollars to fund their plants and ship their profits back to Japan.

You now see how crucial the America Industry is to the foundation of this country.

We must ask and demand all those who live in Michigan, Ohio, Indiana, Illinois and other major American Manufacturing States to return their foreign cars.

If you know of Television or radio personalities who drive foreign cars don't watch and don't listen to them.

If you do watch or listen to them this is only reinforcing their belief that driving foreign cars doesn't matter. The same for shops,restaurants and any other establishment you spend your money at.

If they do not support you and your family, don't support them!

Gm Chrysler News

Here is another New pro American website-Boycott Alabama Now-www.boycottalabamanow.com
From Site:
This site has been developed by a grassroots number of true Americans who have had enough with uninformed politicians who are not helping the domestic auto industry, in this case Senator Richard Shelby of Alabama. Members of our website hold no grudges against all of the hard working people who live in the wonderful state of Alabama. However, it is time to fight back for America and the only way to do it is with our wallets. Our objective is to demonstrate to the senator what happens when a part of America is not supported; therefore we are launching a nationwide boycott of Alabama. It is clear to most Americans that the Big Three must obtain loans in an effort to get through this economic mess (much of which was caused by our illustrious Mr. Shelby, Mr. Barney Frank and many others who failed to prevent the banking industry from going belly up). And to the great people of Alabama, please keep in mind; we didn’t start this mess, our government did.







Contact:Senator Richard Shelby--ph: 202-224-5744

Email




communications@bcatoday.org
(This is the Alabama Chamber of Commerce)
ph: 334-834-6000

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Deal reached in principle on $15B auto bailout
By JULIE HIRSCHFELD DAVIS and KEN THOMAS

WASHINGTON (AP) — A government "car czar" with the power to force U.S. automakers into bankruptcy would dole out $15 billion in emergency loans to the failing industry under an emerging deal between the White House and congressional Democrats.

Officials struck an agreement in principle on the measure Tuesday and hoped to finalize it and schedule swift House and Senate votes as early as Wednesday. Money could be disbursed within days to cash-starved General Motors Corp. and Chrysler LLC, while Ford Motor Co. — which has said it has enough liquidity to stay afloat — would be eligible for federal aid.

All three would have to negotiate with labor unions, creditors and others and submit blueprints by March 31 to an industry czar named by President George W. Bush showing how they would restructure to ensure their survival. If not, the emergency loans would be revoked, the companies cut off from further federal help, and the government overseer could order his own overhaul, including forcing them into bankruptcy.

After days of marathon negotiations over the plan, congressional aides and White House officials were still fine-tuning legislative details of the agreement. It could face substantial obstacles from Republican lawmakers, who remained skeptical of the White House-negotiated plan.

A group of conservatives led by Sen. John Ensign, R-Nev., who has threatened to block the measure, planned a midday news conference Wednesday.

As the measure took shape Tuesday, Sen. Mitch McConnell, R-Ky., said he was concerned that Democrats were proposing a package that "fails to require the kind of serious reform that will ensure long-term viability for struggling automobile companies."

With their approach, "we open the door to unlimited federal subsidies in the future," McConnell said.

Getting 60 votes for an agreement, with many senators expected to be absent for the emergency, postelection debate, could be tricky.

Sen. Carl Levin, D-Mich., an ally of the auto industry, said, "This gets us to the 20-yard line, but getting over the goal line will take a major effort, particularly in the Senate."

He called for Bush and President-elect Barack Obama to lobby personally for the auto bailout.

A breakthrough on the measure came when negotiators reached a compromise to require the czar to revoke the loans and deny any further federal aid to automakers that don't strike restructuring deals by next spring. Democrats had proposed giving the overseer that option but not requiring it.

"A great deal of progress has been made on auto legislation that will protect the taxpayer and ensure that short-term financing is available only to companies prepared to undertake the dramatic restructuring necessary to become viable and competitive," Dana Perino, the White House press secretary, said late Tuesday.

One potential stumbling block remained. Democrats' were still refusing to scrap language, vehemently opposed by the White House, that would force the carmakers to drop lawsuits challenging tough emissions limits in California and other states.

That measure "kills the deal," said Dan Meyer, Bush's top lobbyist.

Senior Democratic aides acknowledged as much Tuesday and said they expected the provision to be dropped.

Environmentalists, who count House Speaker Nancy Pelosi, D-Calif., among their closest allies, already were irate that the bailout uses money set aside for a program to help the automakers finance the retooling of their factories so they could produce greener vehicles.

Another remaining hang-up was over ensuring that Cerberus, the private equity firm that owns Chrysler LLC, would reimburse the government if the auto company defaulted on its loan, said a congressional negotiator who spoke only on condition of anonymity because he was not authorized to disclose details of the emerging deal.

The measure would attach an array of conditions to the bailout money, including some of the same restrictions imposed on banks as part of the $700 billion Wall Street rescue. Among them are limits on executive compensation, a prohibition on paying dividends and requirements that the government share in future profits and taxpayers be repaid before any other shareholders.

Also included in the plan is a requirement that the carmakers taking federal aid get rid of their corporate jets — which became a potent symbol when the Big Three CEOs used them for their initial trips to Washington to plead before Congress for government assistance.