updated 12/8/2008 5:27:26 PM ET 2008-12-08T22:27:26

General Motors Corp. Chairman and CEO Rick Wagoner may have to sacrifice his job for the cash-desperate automaker to get government loans, but industry analysts, a GM board member and even one of the company's harshest critics say now isn't the time to let him go.

As a deal for enough money to keep GM and Chrysler afloat through March emerged in Washington, Senate Banking Committee Chairman Chris Dodd, D-Conn., said on CBS' "Face the Nation" that Wagoner should leave as a condition of GM getting the loans. President-elect Barack Obama, without naming names, said the current auto industry management should be ousted if it doesn't understand the need to make changes.

GM board member Kent Kresa said GM's board met by telephone Monday, but he would not say whether Wagoner's future was discussed.

Other chief executives have been ousted as part of the government's financial industry bailout. American International Group Inc. replaced its chairman and CEO in September after the Federal Reserve took a controlling stake in the troubled New York-based insurer, and the CEOs of mortgage loan giants Fannie Mae and Freddie Mac were forced out.

Kresa, chairman emeritus of Northrop Grumman Corp., said in an interview with The Associated Press that he does not think Congress will require Wagoner's departure, and it would be a terrible move because Wagoner has made great progress restructuring the automaker. But if the board has to choose between vital government money and Wagoner, it will have to consider his ouster, he said.

"If it is contingent on any particular element, whether there's an oversight board, whether the full board needs to go, whether Rick needs to go, whether we have to move from Detroit to Washington, D.C., we need this resource in order to keep this great company going, and we're going to have to look at whatever the demands are from the individual who's bringing the money," Kresa said. "But I don't think it's reasonable."

Even University of Maryland economist Peter Morici, a vocal auto industry critic, questions the timing.

"I advocated Wagoner going a couple of years ago," Morici said Monday. "But at this critical time, it's the wrong time to change helmsmen."

Morici, who testified against the auto industry bailout before Dodd's committee last month, said the boards of GM, Ford Motor Co. and Chrysler LLC should pick who runs their companies, not Congress.

"It's better just to make them show how they can be profitable before giving them the cash," Morici said.

Kevin Tynan, an analyst with Argus Research in New York who also has been critical of GM management, also said the timing is not right to oust Wagoner, who has agreed to work for a $1 salary next year.

"Who are you going to bring in now?" Tynan asked. "You're not even going to get anybody as good as him who is as familiar with the situation, who has dealt with the union, dealt with the dealers. You need someone in there who has dealt with all these groups."

Detroit-based GM is seeking up to $18 billion in loans to help it get through the recession and the worst U.S. auto sales downturn in 26 years, while Chrysler wants $7 billion. Ford has said it could need $9 billion if the sales slump continues, but it has enough cash to make it through 2009 and might not need any help.

Dodd didn't bring up the names of Ford CEO Alan Mulally or Chrysler's Bob Nardelli in his television interview Sunday, and Tynan said Wagoner is the only one of the three executives who has been in place long enough to take blame for their current situations.

Wagoner, 55, started with GM as a treasury analyst in 1977. He became CEO in 2000 and was named chairman three years later. Mulally started in 2006 after being hired away from Boeing Co., while Nardelli, former CEO of The Home Depot Inc., took over Chrysler in 2007.

Mulally, along with and Ford's president of the Americas, Mark Fields, are helping to right Ford and shouldn't be caught up in Congress' criticism, Morici said.

"They didn't create this mess. They're cleaning it up," he said.

GM Vice Chairman Bob Lutz, an auto industry veteran whom Wagoner hired, said the CEO has GM headed in the right direction, cutting its bureaucracy and costs, raising productivity and putting money behind fuel-saving technology research.

"To lose this executive to a ridiculous 'sacrificial lamb' movement would not only be unjust, but deeply harmful to what everyone wants to get done," Lutz told the AP in an e-mail. "People who seem to believe that this is still the GM of the 80s are hopelessly misinformed."

Yet Frank Hammer, a retired GM worker and former Detroit-area local union president, said Wagoner should move on because the company has been slow to change and build more environmentally friendly vehicles.

"I think General Motors has been very slow to come to the table, and to whatever degree Wagoner has been responsible for that, he should bear the consequences," said the 65-year-old, who led a caravan of autoworkers from five states to Washington to lobby for the loans.

In an interview with the AP last week, Wagoner was asked if he would step down if demanded by lawmakers.

"It's not clear to me that experience in this industry should be viewed as a negative, but I'm going to do what's right for the company and I'm going to do it in consultation with the board," he said.

The insider most often mentioned as a replacement is Frederick "Fritz" Henderson, who was named president and chief operating officer in March after serving as chief financial officer since 2006.

Analysts say a serious outside possibility is Nissan Motor Co. and Renault SA Chief Executive Carlos Ghosn, who has industry knowledge and has successfully restructured Nissan. Nissan called such talk speculation.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 3.79%
$30K home equity loan FICO 4.99%
$75K home equity loan FICO 4.69%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.83%
13.79%
Cash Back Cards 17.80%
17.78%
Rewards Cards 17.18%
17.17%
Source: Bankrate.com