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CEO of GM resigns at request of Obama administration

Rick Wagoner, the chairman and chief executive of General Motors, resigned Sunday at the request of the White House, a government official confirmed, reported the BBC.

Wagoner, leader of the ailing automaker, said he would step down immediately after serving as G.M.'s CEO since 2000, reported the New York Times.

His resignation come as 'part of a broad agreement with the Obama administration to funnel more government aid to the ailing auto giant', according to people close to the decision, reported the New York Times.

President Barack Obama is readying outline terms over additional aid to GM as well as Chrysler, who is also struggling, reported the BBC.

The BBC reports that Chrysler is requesting an additional $5 billion, and GM another $16.7 billion. The two firms have already received $17.4bn (£14.4bn) in bail-outs.

GM had no comment on the resignation, but said that it would issue a statment after the President reveiled the details of his rescue plans for the American auto industry, reported the New York Times.

In an interview with CBS, Obama said the firms must do more to justify further aid, saying "they're not there yet", reported the BBC.

"We think we can have a successful US auto industry," said the President, reported the BBC. "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, mean, and competitive than it currently is."

The president’s task force is expected to announce more short-term aid for G.M. and Chrysler, but with stricter rules on the money as well as a deadline on getting concessions from union workers and creditors, reported the New York Times.

GM plans to cut some 47,000 jobs, and Chrysler another 3,000, while cutting some car models. The BBC reports that cuts will take place by the end of 2009, and represents the largest work-force reduction announced by a US firm in the current recession.

New York Times: http://www.nytimes.com/2009/03/30/business/30auto.html?hp
BBC: http://news.bbc.co.uk/2/hi/business/7971202.stm