The next step in the US Treasury's efforts to eliminate its financial interests in General Motors will involve the sale of 30 million shares of the automaker's stock. The government's move to divest itself of GM is all part of a larger plan to sell the remaining 300 million shares of stock it received in compensation for the 2009 bailout of the then-failing automaker. The US Treasury plans to sell off all remaining stock – around 18-percent of GM – by early next year, yet this 30 mil
Back when Ally Financial was known as GMAC Financial, the U.S. Treasury gave it $17.2 billion in TARP funds to weather the global economic crisis. GMAC is now Ally Financial, and although it has repaid $5.4 billion of what it was loaned, there doesn't seem to be a clear path for repaying the outstanding amount. Bloomberg reports that Ally's mortgage unit, Residential Captial (ResCap), is teetering on the ledge of bankrupcty, and its banking operations didn't perform well in the Federal Reserve's
A car that is sitting still with the engine running is getting zero miles per gallon, no matter how efficient the aerodynamics or how great the hybrid powertrain is. Spread out over the entire U.S., all those zero mile per gallon situations – i.e. traffic jams – means Americans are wasting 1.9 billion gallons of gasoline a year, according to a new Treasury Department report. Another way to look at that is that congested roads cost Americans over $100 billion a year (calculated both a
According to The Detroit News, the United States Treasury Department is planning on quickly eliminating its shares of General Motors stock rather than trying to maximize the government's return on its investment. The news comes from Austan Goolsbee, chairman of the Council of Economic Advisors, who said that the government is interested in quickly shedding its 33 percent stake in the automaker due to the fact that it never wanted to be a shareholder in the automaker to begin with. The Detroit Ne
The government of the United States may be actively avoiding any direct involvement in the day-to-day management of General Motors, but that doesn't mean it won't have a say when the time comes for the automaker to go public again. According to The Detroit News, the U.S. Department of the Treasury has hired investment bank Lazard Frères & Co. to provide it with advice on the initial public offering process.
General Motors didn't use another government loan to pay off the much-celebrated $4.7 billion portion of its federal debt. According to a spokesperson with the Treasury Department cited by Bloomberg, the Detroit-based carmaker properly used funds from an escrow account to do the deed. The funds were available for the automaker to use in the event that it ran across any extraordinary expenses, but since the manufacturer decided it didn't need the money, it paid it back.
"The panel is deeply concerned that Treasury has not required GMAC to lay out a clear path to viability or a strategy for fully repaying taxpayers." This, according to a Congressional Oversight Panel that was created as a watchdog for the U.S. Treasury's Troubled Asset Relief Program (TARP) funds. The fix? Potentially breaking GMAC up into units and merging its auto lending business back into General Motors.
The next chief executive of Chrysler will be tasked with bringing the company out of bankruptcy, restructuring into a profitable business, repaying government loans (if and when they do so at all), integrating Fiat technology and retaining jobs wherever possible. Oh, and he or she will have to do it all on no more than $500,000 a year. This according to the latest reports, based on new Treasury Department regulations.
General Motors and Chrysler have been in meetings with the U.S. Treasury this week to discuss how and when the Detroit automakers can again become viable. Both companies are asking for additional billions to fund their perspective turnarounds, but Chrysler is also defending a proposed partnership with Fiat. Fiat's pending 35% ownership stake would provide Chrysler with small and mid-size cars and more fuel efficient powertrains, but no cash.
While there have been rumors and suggested candidates floated for the so-called federal "car czar" post, it now no longer looks like that position will be filled. That's because President Barack Obama has apparently gone cold on the idea. Instead, new reports suggest that he will look to a select group of senior economic advisers for guidance.