Merely competent is not enough now, unfortunately.
It wasn't as cut and dry as "He goes, or else".
It was, IMHO, "You aren't getting another dime out of the U.S. taxpayers until you reorganize and show us a workable business plan. That plan should be sound enough to prevent another bailout request, and if you're not the man who can do it, find somebody else who can. We aren't going to dump more good money after bad."
At which point GM agreed - pretty much a carrot and stick approach. GM was under no obligation to oblige President Obama's request, but if they want to belly up to Uncle Sam's cash trough for a second helping, they'd better show some serious effort, both to the White House and the American public. Saving face means getting rid of the management who steered that behemoth's helm into the current mess, even if they were nice people and brought milk and cookies for the staff every day. If there was an "or else", it would only have meant they were free to get their financing elsewhere. The government wasn't going to shut them down. Their own business practices would do that in due time, without any assistance or intereference from Uncle Sam.
I dunno, maybe I don't see a Brownshirt Kristallnacht Pt. II happening next, although looking back at the results of the first bailout, the White House and Congress should've just said "no" to any more cash injections. If they really want to survive, GM and Chrysler need to file and reorganize the right way.