U.S. government loses $10.5 billion on bailout

The U.S. government ended up losing $10.5 billion on its bailout of General Motors, but still says the alternative would have been much worse.

DETROIT — The U.S. government ended up losing $10.5 billion on its bailout of General Motors, but still says the alternative would have been much worse.

Treasury Secretary Jacob Lew announced Tuesday that the government sold its remaining shares in the Detroit automaker.

The government received 912 million GM shares, or a 60.8 per cent stake, in exchange for a $49.5 billion bailout during the financial crisis in 2008 and 2009. It recovered $39 billion of the money, meaning taxpayers came up more than $10 billion short.

But Lew says the rescue was necessary to save 1 million jobs and stop the American auto industry from collapsing.

GM shares rose 1.2 per cent in after-hours trading following the announcement.

They rose 1.8 per cent in regular trading, at one point reaching $41.17, the highest level since GM returned to the markets with a November 2010 initial public offering.

Earlier Monday, Mark Reuss, GM’s North American president, told reporters in Warren, Mich., that a government exit would boost sales, especially among pickup truck buyers.

GM has said repeatedly that some potential customers have stayed away from its brands because they object to the government intervening in a private company’s finances. Because of the bailout, the company has been given the derisive nickname “Government Motors.”

GM went through bankruptcy protection in 2009 and was cleansed of most of its huge debt, while stockholders lost their investments.

Since leaving bankruptcy, GM has been profitable for 15 straight quarters, racking up almost $20 billion in net income on strong new products and rising sales in North America and China.

It also has invested $8.8 billion in U.S. facilities and has added about 3,000 workers, bringing U.S. employment to 80,000.

Just Posted

Central Alberta Archers Association: Proposed safe drug consumption service location puts youth at risk

Turning Point proposes second location for a permanent safe consumption service in Red Deer

Man dead following altercation at gas station on Sunchild First Nation

Rocky Mountain RCMP say victim succumbed to injuries in hospital

UCP member apologizes for ‘unintentionally’ comparing pride flag to swastikas

A member of Alberta’s United Conservative Party is apologizing for making what… Continue reading

Crowd watches as backhoe rips into mangled plane after Halifax runway overrun

HALIFAX — Crews have begun tearing into the mangled Boeing 747 cargo… Continue reading

Grim search for more fire victims, 31 dead across California

PARADISE, Calif. — The death toll from the wildfire that incinerated Paradise… Continue reading

Updated: Red Deer RCMP introduce downtown policing unit

A four-member downtown Red Deer RCMP unit hit the beat on Thursday… Continue reading

Comic book genius Stan Lee, Spider-Man creator, dies at 95

LOS ANGELES — Stan Lee, the creative dynamo who revolutionized the comic… Continue reading

Canada intelligence officials have heard audio of Khashoggi murder, Trudeau says

PARIS — Justin Trudeau says Canadian intelligence officials have listened to a… Continue reading

Canada hoping to solve U.S. tariff dispute by G20 meetings at month’s end: PM

WASHINGTON — Prime Minister Justin Trudeau says he’s hopeful that Canada can… Continue reading

Bishops will delay votes on steps to combat sex abuse crisis

BALTIMORE — In an abrupt change of plans, the president of the… Continue reading

Man at centre of Nobel body scandal tests rape conviction

STOCKHOLM — The man at the centre of the scandal at the… Continue reading

Chinese premier urges guard of free trade on Singapore visit

SINGAPORE — Chinese Premier Li Keqiang stressed the need for free trade… Continue reading

50 countries vow to fight cybercrime – US and Russia don’t

PARIS — Fifty nations and over 150 tech companies pledged Monday to… Continue reading

More women in poor countries use contraception, says report

KIGALI, Rwanda — More women and girls in poor countries are using… Continue reading

Most Read