US Pleased with GM's Loan Repay

As we told you yesterday, American manufacturer GM announced it will repay the US and Canadian governments the loans received last year as part of the bailout effort for the automotive industry. The initial announcement, made by GM's CEO, Ed Whitacre through a post on the Wall Street Journal website, was reconfirmed during the executive's visit to Washington.

“GM’s ability to pay back the loans ahead of schedule is a sign that our plan is working, and that we are on the right track. It is also an important first step toward allowing our stockholders to reduce their equity investments in GM,” Whitacre said in a release.

“We still have much hard work ahead of us, but we are making progress toward our vision of designing, building, and selling the world’s best vehicles."

The feat achieved by GM was commended by White House officials, including Speaker Nancy Pelosi.

"GM's announcement this week is welcome news and validates Democrats' insistence from the very beginning that federal assistance to the auto industry be repaid in full to U.S. taxpayers. GM must continue on a path toward innovation, energy efficiency, and global competitiveness to ensure that taxpayers recoup their full investment."

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.