Rick Wagoner, the CEO of General Motors, has been ousted. The latest casualty in the current economic saga of approaching the US Federal Govt for helping in the bail-out of the private sector.
I was just commenting to one of my friends a few hours earlier that while I was generally comfortable with the bail-out of the financial sector (including AIG), bailing out Detriot was something else. Not trying to save (temporarily in some cases) AIG and other financial firms clearly had the risk of a global meltdown (see Carol Loomis). I also have no doubt that the ripple effects of the fall of the American auto makers will be profoundly felt (including in my former home-state of Michigan). But the fact remains that there are better managed and more efficient companies to drive the industry forward when we all come out of this horrendous economic mess (yes - we will come out; after all, nothing ever lasts). I am not talking just about the Japanese. Even Ford has been making a number of much required changes for some time now.
Make no mistake. Rick Wagoner was a very good executive. Alex Taylor mentions this in Fortune - and some.
The markets may not like this. The Dow is down as I write. Asian markets fell today. But no one will doubt that GM's existence, at least in its present form, was clearly untenable.