Barack Obama on Wednesday named New Mexico Governor Bill Richardson as his commerce secretary, dubbing him a top "economic diplomat" who would help lead the United States out of the financial crisis.

The president-elect made the latest nomination to his rapidly-filling cabinet at a news conference here and denied the post was a consolation for Richardson, who was passed over for secretary of state.

Richardson, 61, will start "laying the groundwork for long-term prosperity to help American businesses grow and thrive at home and expand our efforts to promote American enterprise around the world," Obama said.

"This work is the core mission of the secretary of commerce and with his breadth and depth of experience in public life, Governor Richardson is uniquely suited for this role as a leading economic diplomat for America."

Richardson, 61, a veteran diplomatic troubleshooter, ex-lawmaker, and energy secretary and United Nations ambassador under president Bill Clinton, had been tipped to head the State Department, but Obama chose Hillary Clinton instead.

The president-elect dismissed the notion that placing Richardson as commerce secretary would disappoint vast numbers of Latino voters who helped him win key battleground states Florida, New Mexico, Colorado and Nevada.

"Commerce secretary is a pretty good job," he said.

"The notion that somehow the commerce secretary is not going to be central to everything we do is fundamentally mistaken," he said, and held out the prospect of adding more Hispanic members to his half-formed cabinet.

Richardson, who spoke in both English and Spanish during the press conference, said he was honored to be chosen.

"There's a vital role for the Department of Commerce in our economic recovery," he said.

"The official role of the department is job creation, economic growth, sustainable development, and improving living standards -- the same goals of your economic plan, Mr. President-elect."

In a short question and answer session, Obama also warned the bosses of struggling automakers that they must present a realistic plan to Congress this week, if they are to secure a a multi-billion dollar bailout.

"We should maintain a viable auto industry. But we should also make sure that any government assistance ... is based on realistic assessments of what the auto market is going to be and a realistic plan for how we're going to make these companies viable over the long term," Obama said.

And Obama ribbed Richardson for shaving his beard, which he said had given the New Mexico governor a "western rugged look."

"For some reason, maybe because it was scratchy when he kissed his wife, he was forced to get rid of it."

Richardson mounted an unsuccessful challenge for the Democratic presidential nomination, hoping to become the first Hispanic US president. He then switched allegiances to back Obama over Hillary Clinton, despite his ties to former president Clinton.

Once dubbed the "Indiana Jones" of US diplomacy, Richardson is famed for daring head-to-head encounters with strongmen leaders on the US pariah list, including Iraq's executed president Saddam Hussein and Cuba's Fidel Castro.

Janet Murguia, president of National Council La Raza, the largest US Latino organization, said she was disappointed that Richardson had been passed over for secretary of state but was glad he secured a cabinet spot.

She also expressed hopes that other Hispanic leaders would be included in Obama's cabinet, as the president-elect has yet to name posts such as Labor secretary, education secretary and US Trade Representative.

"We're still optimistic we will see a cabinet that reflects a coalition of communities that helped to elect President Obama," she said.

"I've been told by the transition leaders that we'll see at least two if not three members who are Hispanics and they're working hard to make choices for the various positions that remain."

The Commerce department in recent years has played second fiddle to Treasury in terms of domestic economic policy and international trade matters, but it is a cabinet level position and the nominee can play a role in both.

The department manages a host of statistical operations including the population census, and also the International Trade Administration which can enforce actions on dumping and unfair trade.

Commerce also manages telecommunications and copyright (intellectual property) issues through its agencies as well as the National Oceanic and Atmospheric Administration weather service.

Hispanics are the largest and fastest-growing US minority group, according to the US Census.