Obama on the auto industry bailouts and restructuring.

"I have never heard of such a thing in all my days: The main representative of the people ordering a corporate chieftain to step down — today! And not just any corporate CEO, but the head of the company that has spent more years at #1 on the Fortune 500 than any other corporation in the world." – Michael Moore

President Obama's statement on auto industry bailouts:
What we are asking [from the auto industry] is difficult. It will require hard choices by companies. It will require unions and workers who have already made painful concessions to make even more. It will require creditors to recognize that they cannot hold out for the prospect of endless government bailouts. Only then can we ask American taxpayers who have already put up so much of their hard-earned money to once more invest in a revitalized auto industry. . . .

Here is one of the reason for Obama's decision to restructure Chrysler and GM: GM & Chrysler kept lobbying to continue their unworkable business decisions.

TPM:

The Obama administration's candid "viability assessments" of GM and Chrysler emphasize one unsurprising but unfortunate theme: Both auto companies have contributed to their own financial demise by relying on gas-guzzling trucks and SUVs instead of cultivating more fuel-efficient cars.

Here's the relevant excerpt from GM's White House status report:

GM earns a disproportionate share of its profits from high-margin trucks and SUVs and is thus vulnerable to energy cost-driven shifts in consumer demand.

For example, of its top 20 profit contributors in 2008, only nine were cars.

And the administration's take on Chrysler was even more grim:

Chrysler's product strength is in the pickup, SUV, and minivan segments - all of which are relatively low in fuel efficiency. On a standalone basis, Chrysler will struggle to comply with increasing fuel efficiency standards, and it may even have to restrict the sale of certain models to make sure it is in accordance with proposed standards.

Meanwhile, GM and Chrysler spent more than $3 million each on lobbying during the fourth quarter of last year -- and part of that money went towards beating back efforts to increase fuel-efficiency standards.

More from the White House website:

This morning the President announced that his Auto Task Force has completed its evaluation of the viability of General Motors and Chrysler in light of their requests for federal assistance. In addition to releasing the viability assessments, he also released a new policy with the American government guaranteeing warrantees for cars from those companies to ensure that if you have one it "will be safer than it's ever been":

Fact Sheet on the New Path to Viability for GM & Chrysler (pdf) >>