GM CEO Wagoner Under Fire

(MoneyWatch)  To regain its financial health through a taxpayer-sponsored bailout, GM may be forced to give up a few things: Saab, Saturn and maybe Chairman and CEO Rick Wagoner, too.

Wagoner is taking some serious heat, as the Detroit Big Three leader with the longest tenure. In one capacity or another, he's been responsible for GM's crucial North American Operations since 1994.

Sen. Chris Dodd, D-Conn., chairman of the Senate Banking Committee, said of Wagoner, "I think he has to move on," on the CBS News program "Face the Nation" on Sunday, Dec. 7. Dodd's committee is critical to passing the proposed bailout.

A story on Page One of today's Wall Street Journal is headlined, "Outside Pressure Grows for GM to Oust Wagoner." (I wrote in this space almost a month ago that Wagoner would occupy the hot seat, in the bailout debate in Congress.)

There's no way Wagoner can plausibly say that a major part of GM's decline leading up to the current crisis didn't happen on his watch. In contrast, Alan Mulally of Ford came from Boeing in September 2006. Bob Nardelli of Chrysler came from The Home Depot in August 2007.

The latter two can tell Congress, as Mulally did in prepared testimony last month, that they "completely agree" with critics, that the U.S. auto industry "needs a new business model."

To be fair, Wagoner has presided for the last couple of years over cutbacks and restructuring at GM that are just as radical and thorough-going as anything Ford and Chrysler are doing.

But unlike the other CEOs, Wagoner is inevitably undoing at least some wrong decisions he himself took years earlier, in a less-hostile environment. From 1994 to 2004, for instance, it seemed there could never be too many big pickups and SUVs. It caught Wagoner and everybody else up short, when gas prices skyrocketed earlier this year and credit markets froze this fall.

"While GM acknowledges that it has made mistakes in the past, the company has been pursuing a major transformation of its business model for the past several years, and accelerating its plans to produce more fuel-efficient vehicles," the company said in the business plan Wagoner submitted to Congress last month.

"At this juncture, the company would not require Government assistance were it not for the dramatic collapse of the U.S. economy, which has devastated the company's current revenues and liquidity," GM said.