• Jul 22nd 2009 at 5:58PM
  • 35
On March 30, President Obama announced that the federal government would back the warranties of General Motors and Chrysler in the event of bankruptcy. When the president says the word "backing," he means cold, hard cash, and in this case the total was $641 million. But with both companies out of bankruptcy court and flush with the government cash needed to run their businesses, it is apparently time to pay the money back.

Automotive News is reporting that new Auto Task Force head Ron Bloom informed a House Judiciary subcommittee that the government would no longer be backing the warranties of GM and Chrysler, adding "consumers can now feel assured that the companies have the financial wherewithal to meet their warranty commitments on a continuing basis."

GM and Chrysler have reportedly returned the $641 million, with interest. GM told Automotive News that it didn't use any of the funds, while Chrysler declined to comment on warranty matters as a matter of company policy.

[Source: Automotive News - Sub. Req. | Image: Justin Sullivan/Getty]

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    • 1 Second Ago
      • 6 Years Ago
      I love my G8. Haters can suck it.
      • 6 Years Ago
      Brian, you sorta suck at life on this one...or at least reading comprehension.

      Now that GM and Chrysler are out from under BK, the government is no longer backing the warranties because,

      "consumers can now feel assured that the companies have the financial wherewithal to meet their warranty commitments on a continuing basis."

      Yup...got that from the same story you commented on.

      It's also interesting to note that GM used NONE of the $641M, but paid it back WITH INTEREST. So those whining taxpayers complaining about money going to failing companies just made a PROFIT on this particular venture.

      Just thought I'd set the record straight before the demagoguing became unbearable.
        • 6 Years Ago
        Google "General Motors Zombie Watch" Chris_O. Meet the New GM: Same as the Old GM. Read the whole series. I'd link it but moderation ate the link.
        • 6 Years Ago

        Please cite a source... ANY source.

        Both companies have restructured debt, sales revenue streams, and cash on-hand.

        Here's more material to have an adult read to you:
        • 6 Years Ago
        The government isn't backing them because they know the companies are toast in the long term and getting out while they can. They're going to say "well, we TRIED" when they go through their second C11/first C7. This is plain for any thinking/objective person to see.

        These aren't saved companies. As TTAC says, they're zombies, and Ford is going to join them.
        • 6 Years Ago

        Wow. Just... wow.

        Brian, the government isn't backing the warranties because the manufacturers are now completely able to handle it on their own.

        I found a post that sadly may not be able to help you. Perhaps you can get an adult to read it to you:
        • 6 Years Ago
        "Bwahaha! Sucker. It only appears they can."

        You win this week's STFU Award.
        • 6 Years Ago
        Brian: Sorry dude, who coached you Rush Limbaugh? Here, let's make a little wager. The day that Big Daddy Fritz takes GM public, all of the doubters and naysayers will be lined up to buy this stock.

        Psst: Currently, GM is a more viable than FORD, go ahead and make your morality argument. Morality doesn't change that mountain of debt that Mr. Mullaly has been so deftly juggling. FORD's living high in public today, but we all know how fickle the American public is. Ford's honeymoon should last about six months or so.

        In the long run, Ford will be fine, and GM will be fine. Chrysler is an unknown quantity.
        • 6 Years Ago
        Google "General Motors Zombie Watch" if you want some reading material, ChrisO.
        • 6 Years Ago
        "These aren't saved companies. As TTAC says, they're zombies, and Ford is going to join them."

        TTAC? Are you &*$# serious? The website that said Chrysler was going C7 in July of 2008 and that the Chinese were going to buy it (and GM!)? That TTAC? You sound like a guy who reads conspriacy theories for fun and probably hangs out at the Daily Kos and Moveon.org, worrying the government is listening in on your phone calls to 1-900-I-AM-LONELY.
        • 6 Years Ago
        I think it's great! And, I think taxpayers will stand to make billions on the bailouts to the major banks too. Just wait...
        • 6 Years Ago
        @Brian: really, it doesn't matter why the government is no longer backing them. It doesn't matter whether the government thinks they are viable long term, because they are out of bankruptcy protection and are beginning to pay back their debts - they paid back the warranty fund with interest, making this a quick and savvy investment for the government.

        Now to see if GM can return to profitability and buy out the government's shares, making it once again a fully private entity. If that happens, I think the internet will implode for a second as all the hotheads who decried the "socialism" deflate :-P

        In any case, this is a sliver of good news. Here's hoping we get more, because we NEED it as an economy.
      • 6 Years Ago
      Ford will not file for bankruptcy now, or ever. period. Mark MY words...

      Ford is puting out good products, with the new F-150, Mustang, Taurus, Fusion, Flex (don't knock it till you try it). Ford Motor Company is starting to be able to "play ball" at every level. Their Focus for the money, their Expedition or Fusion for the Family, the F-150 for the work, their Mustang for the people with a "need for speed" or ones that want behind the wheel of the best sports car in history. Sorry Challenger, Charger, Camaro and Corvette, all yall had gaps where yall wernt being built. The Mustangs been around EVERY year since the get go. Their is not a single current Ford built product that is a p.o.s, including the Ranger which is a hell of a truck. They last forever and are as cheap as hell to fix.

      Now that GM can handel their own, it will be interesting to see their "New GM" moves in the following months and next couple years.

      GM is doing what they can to keep pace and are doing a good job. The Cobalt still sales, the Malibu is doing well, I see a lot of Traverse's, the Equinox is suppost to be a MAJOR upgrade from the current model, and the Silverado's sales figures are ones that the Tundra can't even touch, and the Titan... pshht, it struggles to sell PERIOD.

      The ONE thing wrong about this company to me are all these "doubles". What is the point of the Sierra with the Silverado?? What is the point of the Yukon XL with BOTH the Suburban AND the Escalade?? Heck even the Arcadia with the Traverse AND Enclave?? Some of these doubles and triplets gotta go so GM can concentrate more on their other products.

      Chrysler/ Dodge is the question here. This is the ONE car company I don't care for. They got the Ram, Charger, Challenger, Journey, Sprinter, Caravan (please cut the T&C you dont need it), Viper (for those who BOTH want and can afford), Jeep (minus Compass) going for them... thats all I can think of. The Nitro?... give me a break! Maybe the Dakota is cool tho. Especially with the 4.7. If Chrysler can rebound here and come back to glory, the big 3 will be a strengh and a force for the foreign cars.
      • 6 Years Ago
      This is great and all but we shall see if they will ever pay back the billions that we loaned them. I haven't seen any articles on how quickly GM is going through cash now as the new GM or how much cash reserves they still have left.

        • 6 Years Ago
        Someone please help me understand. People that bought a Chrysler prior to bankruptcy will still have their warranty honored? If this is true, why won't they honor the legal claims that people had against them prior to the bankruptcy? I just figured everyone was screwed? It seems to make sense to me, that to wipe the slate clean, I could ignore all the previous warranties. Sorry if this sounds, crazy, just putting it out there.

      • 6 Years Ago
      This article is an Autoblog Political troll, one of many. A post for purely web hit purposes. You care about this why? Remember when Autoblog was about cars. And now think about how many other posts were trolls.
      • 6 Years Ago
      Why did we save Chrysler again? I would have been ok with the Big 2 consisting of GM and Ford, but Chrysler? C'mon.
        • 6 Years Ago
        Because somebody has to make overweight two-door sedans.
      • 6 Years Ago
      Step right UP! Gummint Motors and FIAT are in the warranty driver's seat now. Their UAW bosses had better start puttin' em' together a WHOLE lot better than they have been or it's gonna be a real short ride.

      How lucky do you feel today?
      • 6 Years Ago
      It's funny how GM, Chrysler speak so enthusiastically about newly-discovered pride and often talk about their bright future. I wonder if they know that they really would NOT even be around had taxpayers not bailed their sorry asses out. These losers should be ashamed of themselves.
      • 6 Years Ago
      Let's get one thing straight...the Camaro is not an unreliable car. It has had 2 issues affecting the first few cars - one minor, one major. Both found early on, both fixed.

      Shall we go through the litany of Honda transmission failures, Tundra camshaft failures, and Camry transmission issues that plagued the early examples of their newer models...issues to which Toyota has to be dragged to court to even admit exist? Is that really necessary again?

        • 6 Years Ago
        you forgot to mention the Tacoma, and Tundra frames that rust out so badly that the trucks become unsafe to drive.
      • 6 Years Ago
      Love the massive oil slick on the service entry floor there. Leaky Chev anyone? J/K
      • 6 Years Ago
      Autoblog-- sometimes y'all get pix from funny places... That dealership (in photograph) is almost certainly the former, folded Marin County, California, Crown Royale Chevy, Hyundai, Caddy, Saab, Hummer dealer that bit it a while back.

      I wandered in a few years ago to check out a Saab 9-5 wagon (with the 4 cylinder turbo, of course), and instantly, the dude working the lot asked, "you sure you don't want a Hummer instead of one of those Saabs? It's got the same engine, plus all wheel drive!" Yes, I walked off the lot. Eyes rolling. And no, government backing or not will they currently service any warranty.
      • 6 Years Ago
      9:41PM (7/22/2009)
      It's funny how GM, Chrysler speak so enthusiastically about newly-discovered pride and often talk about their bright future. I wonder if they know that they really would NOT even be around had taxpayers not bailed their sorry asses out. These losers should be ashamed of themselves.

      Hey wazer
      You mean like the non American Nissan just took almost 2 billion American tax dollars or the fact in less then 1 month GM already paid us back the 600 million plus the interest in profit we made.

      Tell us again why nissan does not have to pay the 2 billion back ?

      TOY ota has lost more money in last 2 years as in all of the past 40 years and is slated to be in constant red for the next 2 years

      So tell us again who are the fricking losers ?

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