General Motors CEO Wagoner steps down

Rick Wagoner, Chairman and CEO of General Motors (GM) is learnt to have stepping down from the company after eight years. This announcement came in ahead of the announcement from the White House about further bailout plans for derailed car makers.

When contacted GM said Rick Wagoner will be stepping down from the company immediately. Vice Chairman and President Fritz Henderson will be taking over and this is at the request of President Obama's Auto Task Force.

The feeling in Washington is that GM, which is due to submit its viability report on Tuesday, has not gone far enough in terms of bringing the bond holders, the United Auto Workers (UAW), and the stakeholders together to meet what was necessary by March 31 and as a result this is the way for the White House to send a strong message by asking Wagoner - as a condition of further aid from the Federal government - that he steps down from the company.

Going ahead, President Obama will talk about what steps are going to be taken from hereon out for GM and Chrysler and they are likely going to be some tight deadlines and conditions put in place. But the bottomline is that the message is going to be sent to the UAW, to the bond holders, - 'everybody has to step up and this has to happen by this day or else the Federal government will take further steps.'

Or perhaps it conveys that it is doing a pre-package bankruptcy with GM and making it clear that one way or the other this company will be restructured either out of bankruptcy or in bankruptcy. This is the first step of the Federal government taking strong action with GM.

With inputs from CNBC's Phil Lebau.

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