GM was loaned money, restructured and payed back the money ahead of time.
General Motors Co. repaid $5.8 billion to the U.S. Treasury and Export Development Canada, Chairman and Chief Executive Officer Ed Whitacre wrote in the Wall Street Journal.
The company is paying back the loans “in full, with interest, years ahead of schedule,” Whitacre said in an opinion article in the Wall Street Journal. The two governments hold a majority of the automaker’s equity, he said.
The repayment shows “our plan for building a new GM is working,” Whitacre said. GM is “leaner, stronger” and building new vehicles whose sales have allowed the company to invest more than $1.5 billion at 20 plants in the U.S. and Canada, he said.
Whitacre said that nobody, including taxpayers and the company itself, was happy that GM needed government loans.
So how is GM business really doing?
GM has, in fact, outsold all other manufacturers in the large U.S. market for every single month of the recession. GM has finally been able to get its financial house in order and this bodes well for a strong future. The GM Equinox is selling so well that it is capacity-constrained, which means all the Equinoxes that are made are sold right away. This is why GM is going to build some in Oshawa. The body stampings and body welding of these vehicles will be done at the Ingersoll plant, and then the vehicles will be sent to Oshawa for paint and final assembly. This is a smart move to use the paint capacity in Oshawa as the paint shop is the most expensive investment with the longest lead time to build. Again, this is good news for our community.
Some good news for the US and Canadian taxpayers who hold a 60% equity stake in GM as a result of the remaining $43 billion in aid. Thankfully, we are past the days when uncertainty drove the main stream press to ask Hewitt and Limbaugh their “expert” opinion on this matter.
Complicating matters, the bailout is triggering a harsh reaction from the conservative end of the political spectrum, with some high-profile pundits calling for an outright boycott of what many are calling “Government Motors.”
Among the most vocal is Hugh Hewitt, who has frequently called for a boycott to protest the “Obamaization of the American car business,” both on his syndicated radio show and on his blog.
Hewitt insists that “individual Americans” must resist buying the automaker’s products because, as he wrote in one blog entry, “every dollar spent with GM is a dollar spent against free enterprise.”
Powerful radio talk show host Rush Limbaugh also has been associated with the movement but said he has not encouraged any boycott.
“I think it is media childishness when people start urging boycotts,” he said on his show this month, according to a transcript posted on his Web site.
He did say he has heard from listeners who do not intend to buy another GM or Chrysler car.
“The reasons I got from people who just sent me e-mails was they don’t want to support Obama’s socialism,” Limbaugh said. “They don’t want to support the notion of government running the car companies, and they don’t want to patronize companies that have been bailed out.”