GM CEO Says On Track For Pre-June Loan Repayment ($8 billion in debt to the US, Canada)

[Purveyor]

Source: REUTERS

SAN ANTONIO, March 10 (Reuters) - General Motors Co will pay back roughly $8 billion in debt to the United States and Canada before June, its chief executive said on Wednesday, more quickly than the automaker had promised.

CEO Ed Whitacre said in December that GM would pay back government loans extended to finance its restructuring in bankruptcy by June.

"I believe we're going to beat that date," Whitacre said on Wednesday in remarks to the Rotary club in San Antonio, Texas, where he lives.

"We have restructured and the progress that we've made, I believe, is sustainable," he said. "We're not being crushed under a mountain of debt. We have a cost structure that works."

Whitacre, who has shaken up GM's sales and marketing teams and pushed the top U.S. automaker for faster growth in sales, said there were positive signs that GM's U.S. market share was holding steady after years of decline.

Read more: http://www.reuters.com/article/idUSN1015879320100310?type=marketsNews

[Purveyor]

1. Interesting no comments 2 1/2hrs after posting. Come on you 'the US will never see a dime in repay

ment of this loan" crowd. Cat got your tongue (or fingers)...?

:toast:

[blue_onyx]

3. More than likely...

they are still bitter that GM is still around. Positive GM threads and negative Toyota threads tend to be ignored on DU. It's just how it is.

[Psephos]

4. They are "paying back" with money that was already given to them, not earned.

It's part of the cash reserve used to stabilize lines of credit when the sky was falling, and held since then against the possibility of a total meltdown. That money was given to them by the Treasury in the first place.

Remember that the US Government owns about 80% of GM currently. MOST of the money that has been sunk into GM was not loaned to the company. GM the old company was hollowed out and stripped, left with only its bankrupt and toxic assets. A new company was created with the same initials, and then most of the government billions went into capitalization through equity (stock). In order to be made whole, the US Government will need to sell its stock at a price that would be higher than at any time in GM's history. Treasury recently admitted that's never going to happen. The stock is not even publicly traded yet. The chance that the stock rises to even 20% of GM's all-time highs "back in the good old days" is, shall we say, a very rosy scenario.

Meanwhile, the publicity regarding this "repayment" is an attempt to fool those who have sworn off buying GM cars based on the political largess bestowed by the US government at taxpayer expense. All previous stakeholders (stock and bond owners) were wiped out, and new stakeholders rounded up to take their place free of charge. Then the bill for this Roman orgy was sent to the taxpayers of the future.

I predict that not many will be fooled.

Please do share your feelings about the Chrysler $$, also.

on edit:

CBO says the US Government will likely lose $47 billion on the "investments" in car companies. This is from http://online.wsj.com/article/SB20001424052748704358004575096044265249772.html

The Congressional Budget Office has offered its own estimate of losses. The CBO has said taxpayers won't recover $99 billion in TARP money. Auto companies are expected to generate $47 billion in taxpayer losses, while AIG-related losses are likely to reach $9 billion.

[toopers]

5. I still believe I will never see any of it . . .

The government has taken it and will not repay me for it.

[blue_onyx]

2. That's great

I'm happy to see GM doing well.