Detroit Bureau on Twitter

Posts Tagged ‘government bailout’

Government Motors No More! Almost

Treasury Department sells off most its remaining shares of General Motors.

by on Oct.29, 2013

The government is in the final phase of getting the Government out of Government Motors.

Government Motors is basically no more, and the final price tag for taxpayers to bailout the automaker is about $9.7 billion.

The U.S. Department of Treasury now owns just 7.3% of the General Motors’ common stock after its most recent stock sell off.

Your Auto News Source!

Taxpayers originally held 60.8% of GM in exchange for the bailout loans. Treasury has been selling down that stake, but ramped up its efforts this year. (more…)

Study: U.S. Aid to Auto Industry Saved 1 Million Jobs

Assistance saved nearly $100 million in personal income.

by on Nov.30, 2010

Government assistance to General Motors and Chrysler enabled orderly bankruptcy proceedings and led to the saving of more than 1.14 million jobs in 2009 alone, according to a recently released study by an automotive think tank.

The study, by the Ann Arbor-based Center for Automotive Research, estimated that an additional 314,400 jobs was saved in 2010. The government help save $96.5 billion in potential personal income losses and allowed $28.6 billion in social security and personal income taxes to be paid to the federal government.

At the time of the bailout, some pundits, and even some lawmakers, suggested that Chrysler and GM didn’t deserve the government’s help. Some even suggested that the bailout was a waste of government money.


Government Concludes, Yet Again, Taxpayers Won’t Get Money Back

GAO says GM, Chrysler won’t be valuable enough.

by on Nov.03, 2009

Is that our tax money under the hood?  Then-candidate Obama tours a Chrysler plant.

Is that our tax money under the hood? Then-candidate Obama tours a Chrysler plant.

Despite an increasingly optimistic outlook for the U.S. auto industry, taxpayers shouldn’t expect to recover the $80 billion of their tax dollars that have been invested in the survival of General Motors and Chrysler, according to government analysts.

A new report by the General Accounting Office contends that even when the two automakers were healthy, they simply wouldn’t have been worth enough for the government to recover its investment once it sells off its 61% stake in GM and 10% share of Chrysler.

This is not the first time such a conclusion has been reached as Ken Zino has previously reported. In fact, the GAO report appears to be a rehash of  a report released in September  by the Congressional Oversight Panel.

Getting the valuation of the two companies up to a profitable level is even less likely now, according to the GAO, a nonpartisan agency that serves as the investigative arm of Congress.

A Deal an Accountant Could Love - Subscribe for Free!

A Deal an Accountant Could Love - Free!

“Treasury is unlikely to recover the entirety of its investment in Chrysler or GM, given that the companies’ values would have to grow substantially above what they have been in the past,” said a GAO summary of its latest findings.


Chrysler Can Survive Worst Down-Market, says Jim Press

Automaker preparing to ride through the worst, even without Fiat alliance.

by on Feb.03, 2009

Chrysler still viable, says V. Ch. Jim Press

Chrysler still viable, says V. Ch. Jim Press

Despite the doom and gloom sounded by ratings agencies and Southern Senators, Chrysler is preparing to ride out the worst the economy can throw at it, and will be able turn a reasonable profit even in a long recession, the automaker’s vice chairman told reporters during a Tuesday “roundtable.”

The sharp cuts Chrysler has made since it was taken over by Cerberus Capital Management, in 2007 have repositioned the automaker to survive even an extended downturn in the U.S. market, asserted Jim Press, the troubled automaker’s second-in-command.

“We feel we’re on a firm footing, financially,” proclaimed Press, prior to beginning the last of eight meetings Chrysler has held with dealers from across the U.S.

According to the plan Chrysler submitted to the federal government to justify a bailout, the U.S. market will slip by as much as 2 million units, this year, to a total sales volume of just 11.1 million, and could hold at that dismal level “for a couple years, and maybe as much as four years, going up to 13 million”,” when the market finally starts to recover. And, if anything, added Press, a worst-case scenario could see sales slip as low as 10 million.

Even at that level, Chrysler claimed, “We were still viable. We were still okay,” according to Press.