White House revising an office overseeing help to struggling auto communities

Article by Christian Andrei, on May 9, 2011

In order to continue getting funds, the auto recovery office of the White House should quantify the benefits that the vehicle manufacturing industry in the U.S. saw from the automaker bailouts, the Government Accountability Office said on Tuesday.

The GAO stated in a report that Congress should consider not to give funds to the auto recovery office, which is part of the Labor Department, until it identifies the benefits that U.S. cities get from the assistance to two of the three biggest vehicle companies in the nation.

There has been no director in the auto recovery office since Ed Montgomery resigned in 2010. A spokesman for the auto recovery office did not respond to a phone call for comment. The GAO made its statement in a report that deals on the support of the U.S. to General Motors Co. and Chrysler Group LLC, which is operated by Fiat SpA.

On another note, the GAO mentioned that certain Treasury officials had said the U.S. Treasury Department could possibly sell its 9 percent equity share in Chrysler to a third party.

The GAO disclosed that the Fiat-operated company would require a market value of around $41 billion in order for the Treasury to recoup its investment. The market value of the vehicle manufacturer was around $31.7 billion in 1997 - the last time it was publicly traded, according to the report.

Topics: united states

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