GM repays bailout loans to US, Canada
- Source: Shanghai Daily
- [09:56 April 22 2010]
- Comments
The worldwide headquarters of General Motors in downtown Detroit, Michigan
General Motors Co has repaid the $8.1 billion in loans it got from the United States and Canadian governments, a move its CEO says is a sign the car maker is on the road to recovery.
GM CEO Ed Whitacre was due to formally announce the loan paybacks yesterday at the company's Fairfax Assembly Plant in Kansas City, Kansas, along with announcing that GM is investing $257 million in that factory and the Detroit-Hamtramck plant, both of which will build the next generation of the midsize Chevrolet Malibu.
GM got a total of $52 billion from the US government and $9.5 billion from the Canadian and Ontario governments as it went through bankruptcy protection last year. The US considered $6.7 billion of the aid as a loan, while the Canadian governments held $1.4 billion in loans.
The US government payments, made on Tuesday, came five years ahead of schedule, and Whitacre said they are a sign that the auto maker is on its way toward reducing government ownership of the company. The payments on the Canadian loans were also made on Tuesday.
GM still owes $45.3 billion to the US and $8.1 billion to Canada, money it received in exchange for large stakes in the company. The US government now owns 61 percent of the company and Canada owns roughly 12 percent. GM plans to repay both with a public stock offering.
"Nobody was happy that GM needed government loans - not the governments, not the taxpayers and, quite frankly, not the company," Whitacre wrote in The Wall Street Journal.
"We believe we can best thank the citizens of the US and Canada by making sure that their investments are hard at work every day, building high quality, fuel-efficient vehicles."
