Report: U.S. bailout of the auto industry saved the government $28.6 billion

Article by Christian Andrei, on November 19, 2010

Ahead of General Motors Co.’s initial public stock offering, the Center for Automotive Research (CAR) in Ann Arbor, Mich. said that the U.S. bailout of the auto industry saved the government $28.6 billion and is close to a “two-year breakeven.”

GM’s IPO aims to raise up to $22.7 billion, which would be divided among the U.S. and Canadian governments and a retiree health-care trust administered by the UAW. CAR explained that government aid for Chrysler and GM saved more than 1.14 million jobs in 2009 and another 314,400 jobs in 2010.

Its asserted taht the net impact to the federal government (in terms of personal income taxes, Social Security receipts, and changes in transfer payments) was US$21.6 billion in 2009 and $7.0 billion in 2010.

CAR’s study determines that the bailout saved the government $28.6 billion in, for instance, tax revenues it might have lost.

CAR’s chief economist Sean McAlinden says the $13.4 billion in principal has been repaid on the government’s $80 billion U.S. investment in the automotive industry. To get a “two-year breakeven”, the government needs to recover $38 billion of the remaining $66.6 billion outstanding investment in the industry. [via autonews - sub. required]

Topics: united states

If you liked the article, share on:


Login or Create new account to add a comment!


We’ve seen quite a lot of intriguing stories in the age of Internet (where the most interesting part was revealed before the story unfolds). Some are from movies and novels...
by - October 26, 2016
Many people have long known that the new 2018 RS5 was being developed by Audi AG. Enthusiasts the world over were excited when a prototype was seen running on the...
by - October 26, 2016
It was only recently when BMW officially debuted the new 2017 5-Series Saloon (G30) online. At that time, this range revealed that it had driving dynamics that was the best...
by - October 26, 2016
Starting early 2017, the new Audi Q7 will be available with the new 2.0-liter TFSI four-cylinder engine that makes it not only faster but also lighter and more efficient than...
by - October 25, 2016
Soon, Fiat Chrysler’s Dodge brand will be ending the production of the Dodge Viper. So practically, the 2017 Dodge Viper will be the last Viper up for grabs. Gerry Wood...
by - October 25, 2016