GM Repays $5.8 Billion to US, Canada

As hinted since the beginning of this week, American manufacturer GM announced, through the voice of its CEO, Ed Whitacre, that it has repaid the remaining $5.8 billion to the U.S. Treasury and Export Development Canada. The announcement was made by Whitacre prior to his visit to the Fairfax Assembly Plant through a post in the Wall Street Journal website.

"Our ability to pay back these loans less than a year after emerging from bankruptcy is a sign that our plan for building a new GM is working," the CEO says. "It is also an important step toward eventually reducing the amount of equity the governments of the U.S., Canada and Ontario hold in our company."

Last year, GM received $52 billion from the US government to survive the bankruptcy process. Out of that amount, $45.3 billion was converted into equity as the government got 61 percent of the car manufacturer.

For the last quarter of 2009, the revived GM announced a $4.3 billion net loss, a global revenue of $57.5 billion and net cash coming from operating activities of $1 billion. At the end of 2009, GM was sitting on a $36.2 billion reserve.

Initially, GM announced it will repay the entire loan to both governments by June, still some five years ahead of schedule. The announcement made yesterday by Ed Whitacre is a sign, he believes, GM is a “leaner, stronger” company and the plan to build a new GM is on the right track.
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About the author: Daniel Patrascu
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Daniel loves writing (or so he claims), and he uses this skill to offer readers a "behind the scenes" look at the automotive industry. He also enjoys talking about space exploration and robots, because in his view the only way forward for humanity is away from this planet, in metal bodies.
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