Chrysler Prepared To Repay U.S. Treasury Loans
RENEE MONTAGNE, host:
It's payoff day for Chrysler. The automaker is announcing today that it's paying back the bailout money it received from the U.S. and Canadian governments during the financial crisis.
As Michigan Radio's Tracy Samilton reports, it's another milestone for a company that's slowly rebuilding itself.
TRACY SAMILTON: The U.S. Treasury will receive about $6 billion via wire transfer today, payment in full for Chrysler's outstanding federal loans. The repayment is early - really early. Most of the loans weren't due until 2017.
CEO Sergio Marchionne says he's grateful for the government's help. Now it's time to move on.
Mr. SERGIO MARCHIONNE (CEO, Chrysler): It closes a chapter, and it was a necessary chapter. It was unpleasant, but it had to be done.
SAMILTON: Paying back the federal loans does more than give the automaker an image boost. Refinancing will save Chrysler $300 million a year in interest. For a company that made a profit of only $116 million this past first quarter...
Mr. MARCHIONNE: That is a lot of money.
SAMILTON: The repayment doesn't completely end the government's role. The U.S. Treasury still owns eight-and-a-half percent of Chrysler's stock. But it's possible the Treasury may decide to sell the stock back to Chrysler at some point, instead of selling it to investors in an IPO.
For NPR News, I'm Tracy Samilton in Ann Arbor.
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