A deadline for the auto industry

President Obama delivered an ultimatum to the auto industry, demanding that General Motors and Chrysler reinvent their companies in much leaner form or face an end to federal bailout funds.

What happened

President Obama this week delivered an ultimatum to the auto industry, demanding that General Motors and Chrysler reinvent their companies in much leaner form or face an end to federal bailout funds. Obama and his auto-industry task force rejected a restructuring plan submitted by the two floundering auto companies, and in an indication of its displeasure, the task force forced out GM CEO Rick Wagoner. GM was given 60 days to submit a new restructuring plan, while Chrysler was given 30 days to complete a merger with the Italian company Fiat. “This restructuring, as painful as it will be,” said Obama, “will mark not an end but a new beginning for a great American industry.”

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