CEO Ed Whitacre announced the repayments Wednesday at GM's Fairfax Assembly Plant in Kansas City, Kan., where he said GM is investing $257 million in that factory and the Detroit-Hamtramck plant. This afternoon, he flies to Washington to meet with top lawmakers.
The White House pointed to GM's repayment of the loan and Chrysler LLC's posting of an operating profit in the first quarter of 2010 as concrete signs that the bailout of the U.S. automakers was working.
GM got a total of $52 billion from the U.S. government and $9.5 billion from the Canadian and Ontario governments as it went through bankruptcy protection last year. At first the entire amount of U.S. aid was considered a loan as the government tried to keep GM from going under and pulling the fragile economy into a depression.So GM also got money from Canadian taxpayers as well?
But during bankruptcy, the U.S. government reduced the loan portion to $6.7 billion and converted the rest to company stock, while the Canadian governments held $1.4 billion in loans. Those loans were repaid Tuesday, five years ahead of schedule.
The automaker hopes to repay the remaining $45.3 billion to the U.S. government and $8.1 billion to Canada via a public stock offering, perhaps later this year. The U.S. government now owns 61 percent of the company and Canada owns roughly 12 percent.
You know the sooner GM is able to pay off it's gov't loans the better. No one was happy about these bailouts and gov't outright owning a business. I just hope that in the future we don't repeat this example.
BTW, while looking for stories on this I found this headline "GM Pays Back TARP, But Unions May Need More" from FOX Business. I almost used this article, however, many may view FOX as having their own bias.
Within five years, they will have to pay $15.7 billion into the carmakers' union pensions to comply with federal funding requirements, ($12.3 billion to GM’s pensions, $3.4 billion to Chrysler’s plans), according to the GAO report.The problem with the automakers that are struggling right now many are saying rest with the unions they have to work with.
BTW, I would really like to buy that new Cadillac SRV in a newly privatized GM. Just saw that vehicle today although not the whole vehicle. It's really a nicely designed vehicle unlike it's predecessor.
ALSO, when will they bring back either Oldsmobile or Pontiac!