Business

Is car industry prepared to give the money back to government?
by kristina leskova

Two very well known automobile companies – General Motors and Chrysler found themselves in serious problems. Just few months ago they received 81 billion dollars as government aid. This should help them to reschedule the auto industry. Last reports say that there exists huge risk that General Motors and Chrysler which received 23 billion dollars will not be able to give the money back to government. How much can the government gain from the General Motors and Chrysler depends on shares of the two companies. The real situation is that government owns ten percent of Chrysler and 61 percent of General Motors. Like the reports say that it is expected to issue their stocks! somewhen during the next year. The shares will have to have high value because the taxpayers want their money back. For example this situation would require that market value of General Motors will reach 67,6 billion dollars. The report also says that Chrysler will not be able to give all the money back, about 5,4 billion dollars should remain unpaid. Some analysts think that 23 billion dollars that have been given to General Motors and Chrysler will be lost money. But there are also people who think that all or almost all of the money will be given back to government. Administration officials said that they want to give maximum to taxpayers but they will try to get the government out of the car business. The spokesman of General Motors – Greg Martin said that GM will repay the given money because their company has a stronger balance sheet, good product portfolio and knows today´s market.

related story (sgx15327): http://news.yahoo.com/s/ap/20090909/ap_on_bi_ge/us_tarp_over...

by kristina leskova for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.

posted by Blog TechSource @ 4:24 PM