General Motors has returned $140 million to the US Treasury Department due to internal cost cutting and reduced supplier costs. The program was created in April and gave GM access to $2.5 billion to allow GM to offer financing options to its suppliers.
The aid program was created to help assure suppliers that they would continue to receive payment during both GM’s and Chrysler’s bankruptcies and originally had allotted GM $3.5 billion, and Chrysler $1.5 billion.
In July, the amounts were reduced to $2.5 billion for GM, and $1 billion for Chrysler due to decreased demand.
Suppliers taking advantage of the program were given two options: receive an immediate payment, or receive a guarantee of payments. The immediate payment option had a fee of 2 percent, and the guaranteed plan required only a 1 percent fee.
Due to the added fees involved with immediate payment, only half of the suppliers using the program chose the immediate payment option. GM reports that approximately 375 of its suppliers chose to participate in this program with one of the two options.
“The biggest reason is suppliers are feeling better about getting paid through normal channels,” said GM spokesman David Adler in an interview with the Detroit News.
In total, GM currently has access to $2.5 billion, but is using far less to pay its suppliers. Up to $150 million in potential funding for GM is set to expire next year.
11/25, 7:33 AM
posted by:
easyrider
so GN is being open and forthright and they still get crucified by the effin communists that call themselves americans.
11/25, 7:34 AM
posted by:
easyrider
Maybe GM can send the money to Toyota to help cover the costs of fixing their POS rusty trucks.
11/25, 8:54 AM
posted by:
carstuff
Slowly, even just months out of bankruptcy, GM continues to pay off its debt.
Hopefully by this time next year they will have paid off all the LOANS (not the $30 billion of government investment that will be covered by an IPO)
11/25, 9:03 AM
posted by:
jayjc08
easyrider- I’m not trying to crucify Gm or anyone here, but if they were being deceptive, they would want to post the positive info like this, while seeming “forthright”.
And from what I can tell, they haven’t “repaid” any of their debts. They just haven’t used $140 million in funding that the government made available to their suppliers (yes, you can technically say they are paying back their debt, but this doesn’t mean that they’re profitable or on the track to repay the money they’ve already used). The money that they had actually used hasn’t been paid back yet.
11/25, 9:06 AM
posted by:
jayjc08
Scratch that last paragraph, that wasn’t worded very well. What I mean is, this is money that they haven’t used, so they’re in the process of returning it. This isn’t a part of the actual debt that they’ve used up in operations. Until they’re profitable, I don’t foresee them paying back their actual debts.
11/25, 10:34 AM
posted by:
leftwingagenda
http://online.wsj.com/article/SB10001424052748704431804574538281493267824.html
not sure you’re really correct saying they haven’t repaid “any” of their debts…it’s going to be a long road, for sure, but obviously they are making some strides towards making some payments in some areas…they’re talking about repayment a lot sooner than i expected, actually…
11/25, 11:04 AM
posted by:
Cardemon04
how is this news? they gave back money that they were loaned and did not use. it was probly part of the loan agreement that they would give back loaned money that was unused at a certain date.
11/25, 11:31 AM
posted by:
h82w8
Talk about grasping at straws. I get that this is news, but let’s keep things in perspective. They didn’t use this money and were likely compelled to return it based on the contract that was signed to get access to the money in the first place.
Moreover, how much have they taken (yes, taken) from taxpayers? $55 billion?
To the apologists convinced that an IPO will somehow yield that much market value, I sure hope you’re right and that investors are dumb as bricks to overpay for GM by that margin. The company has a value of $15-20B after it sold much of what wasn’t bolted to the ground.
It lacks the leadership and culture to successfully compete. Sure, their products are MUCH better than they were, but they don’t appear to be able to make game or class changing cars. Look no further than the shenanigans they’re pulling with Opel to see it’s run by a bunch of shysters.
GM defenders need to pull their head out.
11/25, 12:09 PM
posted by:
Ashes to Ashes_Dust to Dust
GM is simply robbing Peter to pay Paul.
11/25, 12:37 PM
posted by:
Krugeri
Nice. $100 million here and $100 million there and soon you’re talking about real money. Good for GM.
Not certain how people who complained, somewhat voraciously, that we loaned any money to GM can turn this into something negative, but I am sure they’ll try.
I would rather be appreciative of any and all monies we get back.
But I’m an optimist.
11/25, 12:50 PM
posted by:
e46Ne90
i dont recall the exact amount gm borrowed but 140million? that’s like saying I borrowed $100 from you but here’s a dollar! I promise I pay you back the $99 someday
11/25, 4:02 PM
posted by:
Borat
@ h82w8 & @ e46Ne90, correction, with 6 billion for GMAC (and it 51% owned by GM & 49% by Cerberus) the number is 60 billions.
11/25, 4:28 PM
posted by:
Cardemon04
Borat: stop making things up. US treasury owns 34% of GMAC. Cerberus owns 22%, and GM only owns 9.9% of GMAC as of June this year.
11/25, 8:46 PM
posted by:
psiclone
Any repayment or giving back of money by GM to the tax payers is a good thing.
People like Ashes, e46Ne90, h82w8, Borat, that feces guy and some others on here will always dramatically play up the cloud in GM’s silver lining. Even if it requires a little fibbing here and there. Signature trait of a propagandist.
11/25, 10:33 PM
posted by:
carstuff
More complaints. Every time it is announced that GM is paying back more, there are more complaints. What happened to the folks that said GM would never pay any back? Market share is going up. The naysayers got it wrong but they continue to naysay.
11/26, 10:08 PM
posted by:
A.J.
Say what you want, but EVERY LITTLE BIT COUNTS.
11/27, 5:44 PM
posted by:
oldraven
Great news. Now it’s Canada/Ontario’s turn to get repaid a bit. Every little bit does count, but not if only one guy is getting paid back.
11/29, 8:11 AM
posted by:
carstuff
raven: been announced
GM , due to unveil its first post-bankruptcy earnings report Monday, will begin making $1 billion quarterly installments on the loan on Dec. 31. At the same time, the automaker also will start repaying a $1.4 billion loan to Canada at a rate of $200 million per quarter.