General Motors paying back the Government
Simon Constable, WSJ, hosted the John Batchelor show and we talked about the fact that General Motors has been given such a hard time for taking money from the Government. In an ironic twist of fate, within the next year, General Motors could be the only Detroit 3 car company that won’t owe the Government money.
The Wall Street Journal reported that the U.S. Treasury could sell its remaining stake in General Motors Co. within the next year, an Obama administration official said Wednesday, signaling a much shorter time frame than the automaker initially expected.
It’s no longer up to General Motors when they will be free of the government. The Government gets to decide when they will sell their stock, and at what price.
This week General Motors rescinded a request for $14.4 billion in AVTM funds, further reducing any dependence on the federal government.
Chrysler will owe money to the United States Government until they bring out an IPO. Fiat holds a 25% stake in Chrysler, with an option to increase its stake up to 51% if it meets financial, environmental, and developmental goals for the company.
The company that didn’t take the bailout did take $5.9 billion in the ATVM loan.
What is AVTM?
Section 136 of the Energy Independence and Security Act of 2007 established an incentive program “ the Advanced Technology Vehicles Manufacturing (ATVM) Loan Program “ consisting of direct loans to support the development of advanced technology vehicles and associated components in the United States
There have been over 70 companies that have applied for the ATVM loan. So, far only five companies have received the ATVM money. They are:
Ford Motor Company $5.9 Billion
Fisker Automotive $529 million
Nissan North America $1.4 billion
Tesla Motors $465 million
The Vehicle Production Group LLC – $50 million (VPC is a T. Boone Pickens group that is going to make an SUV that uses natural gas)