Wagoner to leave GM on Obama request

US President Barack Obama asks the head of General Motors to resign as the government readies to announce a plan to save the auto sector.

"The Obama administration asked Rick Wagoner, the chairman and CEO of General Motors, to step down and he agreed," an unnamed White House official said on Sunday. 

GM spokeswoman Katie McBride, however, did not comment on the resignation. 

The request came as President Barack Obama is expected to unveil a plan aimed at averting the collapse of car giants namely GM and Chrysler on Monday. 

President Obama said in a Sunday interview with CBS that the two firms had failed to revitalize the industry. 

"We think we can have a successful US auto industry. But it's got to be one that's realistically designed to weather this storm and to emerge - at the other end - much more lean, mean, and competitive than it currently is." 

Obama's remarks come as General Motors and Chrysler have been seeking another 21.6 billion dollars in government loans to escape bankruptcy and to restructure the industry. 

GM spokesman Tom Wilkinson said in a statement that 'additional support' would help the firm accelerate efforts to 'reinvent' GM. 

However, Treasury Secretary Timothy Geithner told ABC on Sunday that the government was prepared to help that process if it believed "it's going to provide the basis for a stronger industry in the future that's not going to rely on government support". 

The auto industry, which has been crippled by the global slowdown, is a key part of the US economy.