It seems like a fairly good bet that the Big Three will land government loans somewhere in the neighborhood of $15 to $17 billion, but the terms destined to be attached to those loans remain anyone’s guess. Some industry analysts are predicting Congress will require General Motors to remove Rick Wagoner from his position as company CEO in order to secure funding, but GM vice-chairman Bob Lutz warns that move would be ill-advised.
In an interview with CNBC, Lutz contested the idea that GM needs a clean slate when it comes to management, and likened Wagoner to a “sacrificial lamb”.
“I think that’s like blaming the mayor of a city that has been hit by an earthquake,” Lutz said of the possible firing of Wagoner over GM’s current financial situation.
GM’s financial situation has been deteriorating since 2005 –losing $70 billion in the last three years — but has been greatly accelerated by the recent global economic downturn. Wagoner took over as GM CEO in 2000, but didn’t seize full control of the automaker’s North American car division since 2005. Although GM has lost $70 billion in that span, Wagoner has been able to reduce GM’s operating costs by $20 billion.
“He is without doubt the best CEO I’ve ever worked for,” Lutz said in closing.
