GM pays back US & Canadian loans way early

[Ronn]

They definetely made a change for the better.

[ThAtYoUnGinBoI24]

l0l yeaaa nobody thought we would get this far but you would think the camaro largely helped?

[Shuffler]

The government has no money. The loan was from us.

[Rollin Thunder]

haha I saw that commercial in radioshack buying outdoor speakers. Made me proud to hop in my corvette for the drive home.

[Rollin Thunder]

Originally Posted by ThAtYoUnGinBoI24

l0l yeaaa nobody thought we would get this far but you would think the camaro largely helped?

I think it was the camaro and all their other new models such as the malibu and equinox, etc. I hope they still target the large suvs and trucks though. Thats what I love most about GM.

[1bad65]

Originally Posted by Maa107

I think what really brought them down was those damn unions

You are correct.

Paying guys $75/hr to put together plastic dashboards wasn't such a good business plan.

[Mr. Wyndham]

Originally Posted by 1bad65

You are correct.

Paying guys $75/hr to put together plastic dashboards wasn't such a good business plan.

If only it were that easy. The labor costs were not a cause but an effect of the same reason that brought GM down....this thing snowballed out of control starting in the 70s. Nailing any one group/person/thing down for it would be inaccurate.

[robertway]

Originally Posted by talwell

I am very proud of GM - most people were very against them getting the government loan but did not take the time to think of the affects that it would have it they did not get it. Not only would the US have lost one of its most valuable companies and possibly the industry as a whole, but also millions of people would have lost thier jobs. Not only this, but if the US Government would have allowed GM to close the amount of tax revenues that would have been lost would have easily out weighed the amount of money they lent them.

Way to go GM - I think you are on the right path. I will admit that I think that GM did sway from the path of high quality cars and innovative designs but I am glad to see they are finding their way back to the top of the industry.

You make the assumption that GM as a whole would have collapsed and that is the rhetoric that was initially used to try and scare folks and gain support for "bailing them out". The reality is, a structured bankruptcy without government purse-string-pulling would have allowed GM to come out the other side leaner and meaner. While there would definitely have been displaced labor in the near term the long term stability would have had a much better opportunity to establish itself and ensure longer term employment for many more people. It is called a business cycle, it weeds out failure.

With the government having gotten involved, what has REALLY been fixed I have to ask. Smoke and mirror ads and "hey we're back" rhetoric don't mean shat. What is it that has changed, how is the GM/Union relationship different, have the government regulations (C.A.F.E.) standards been changed to loosen the iron-fisted grip the Feds have around the collective automakers throats. Seems to be from a business perspective, other than killing a few brands, it is business as usual so all that has really been done is delaying the inevitable collapse but since the precedent has been set they'll just be bailed out again, and don't dismiss the notion for a second that if GM were down south in a right-to-work State they wouldn't have been left alone to dither on the vine.

I will agree that GM is definitely on the right path with their products, it just has to play out whether their business practices will allow their products to survive.

Originally Posted by The_Blur

GM paid the loans. The rest is up to the IPO and the government. The government can get rid of its stock at its own discretion. GM has no say in this. At this time, GM has exceeded its obligations by paying a loan with interest early. That's not only impressive but respectable and demonstrative of the company's success.

When you use borrowed money to pay back borrowed money, you didn't really accomplish anything, it really just means you borrowed, or in this case, accepted, more than you REALLY needed which in and of itself can be viewed as a positive. If their annual earnings statement would come out to say they woulda had a 10 billion dollar profit but they used 8 billion of it to pay back a portion of their loan then I would be more encouraged but when you move numbers from one line on the ledger to another you really didn't accomplish anything. I can borrow 5G from my Visa card to pay off the 5G on my MasterCard, did I really accomplish anything?

Originally Posted by Dragoneye

If only it were that easy. The labor costs were not a cause but an effect of the same reason that brought GM down....this thing snowballed out of control starting in the 70s. Nailing any one group/person/thing down for it would be inaccurate.

I'm going to have to second Dragoneye here in saying the blame cannot solely rest on any one group's shoulders. Do I disagree that things like parking cars that roll off the line in a large lot or torquing three bolts into door hinges for each car that comes past you is worthy of roughly $75/hr in total benefits, I absolutely disagree with that. But if management sitting on the other side of that contract is willing to sign it, then they're jackasses for doing so and another hand that held the pen to put the writing on the wall for what has played out over time.

Couple those two entities at two ends of a rope and you get a very difficult and unsustainable economic model, add to that the government shaking the rope along the way with C.A.F.E. (which are BS and have done nothing to significantly reduce consumption and wind up contributing to more deaths since people are driving around in tin-cans), corporate taxation (which is just passed along to us as the consumer), and their choke-hold on fossil fuel energy production that jacks up gasoline prices and you have a recipe for what has transpired.

You see what happens when an automaker has the opportunity to build the car it wants to build because it knows it is a car the market wants, you get a Camaro that hands its rivals their arses in sales and in today's eco-marxist-tree-hugging-3$-a-gallon-for-premium world still manages to sell by a significant percentage the V8 beast of the bunch.

[Unfair]

Latest on bailout/repayment: http://www.foxnews.com/politics/2010...bailout-money/
A top Senate Republican on Thursday accused the Obama administration of misleading taxpayers about General Motors' loan repayment, saying the struggling auto giant was only able to repay its bailout money by dipping into a separate pot of bailout money.

Sen. Chuck Grassley's charge was backed up by the inspector general for the bailout -- also known as the Trouble Asset Relief Program, or TARP. Watchdog Neil Barofsky told Fox News, as well as the Senate Finance Committee, that General Motors used bailout money to pay back the federal government.

"It appears to be nothing more than an elaborate TARP money shuffle," Grassley, the ranking Republican on the Senate Finance Committee, said in a letter Thursday to Treasury Secretary Timothy Geithner. But Grassley said in his letter that a Securities and Exchange Commission form filed by GM showed that $6.7 billion of the tens of billions the company received was sitting in an escrow account and available to be used for repayment. He called on Geithner to provide more information about why the company was allowed to use bailout money to repay bailout money, and how much of the remaining escrow money GM would be allowed to keep. "The bottom line seems to be that the TARP loans were 'repaid' with other TARP funds in a Treasury escrow account. The TARP loans were not repaid from money GM is earning selling cars, as GM and the administration have claimed in their speeches, press releases and television commercials," he wrote. Vice President Biden on Wednesday called the GM repayment a "huge accomplishment."

But Barofsky told Fox News that while it's "somewhat good news," there's a big catch.

"I think the one thing that a lot of people overlook with this is where they got the money to pay back the loan. And it isn't from earnings. ... It's actually from another pool of TARP money that they've already received," he said Wednesday. "I don't think we should exaggerate it too much. Remember that the source of this money is just other TARP money."

Barofsky told the Senate Finance Committee the same thing Tuesday, and said the main way for the federal government to earn money out of GM would be through "a liquidation of its ownership interest."

Grassley criticized this scenario in his letter.

"The taxpayers are still on the hook, and whether TARP funds are ultimately recovered depends entirely on the government's ability to sell GM stock in the future. Treasury has merely exchanged a legal right to repayment for an uncertain hope of sharing in the future growth of GM. A debt-for-equity swap is not a repayment," he wrote.

Am I reading this right????????

[Unfair]

Originally Posted by The_Blur

GM paid the loans. The rest is up to the IPO and the government. The government can get rid of its stock at its own discretion. GM has no say in this. At this time, GM has exceeded its obligations by paying a loan with interest early. That's not only impressive but respectable and demonstrative of the company's success.

Did you read the latest news? :(

[Kreature]

hmm interesting, i hope its not 100% true. although i was kinda suspicious on how GM was able to repay their bailout money so quickly.

[Blade]

The thing is that there is no way that can happen. GM has already reported a $4.3 Billion loss at the end of last year, which curiously coincides with payoff the of loan. It just doesn't make accounting sense, what this Senator is spewing hot air about.

Now remember they still have to pay $45 Billion back to the govt, because all that money has been converted to stock. Once they go public later this year, they will be able to pay that off, untill then the govt still owns GM...

http://www.usatoday.com/money/autos/...-gm-loan_N.htm

[1badSS/RS]

So, GM didn't use this loaned money and gave it back??? Is that what they are saying? If so, what is the problem?

[Blade]

Originally Posted by 1badSS/RS

So, GM didn't use this loaned money and gave it back??? Is that what they are saying? If so, what is the problem?

$56 billion were borrowed initially, the $45 of which was converted to stock to be made public later. The remaining monies were paid off essentially because they didn't use much of it and or the cash flow for them has really been that good.