Report: GM to begin repaying $6.7 billion in government loans early
By Andrew C., 27 Aug, 2010. 0 Comments
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According to Automotive News, General Motors will announce today that it plans to start repaying its $6.7 billion loan to the U.S. Treasury by year-end due to the modest operating improvements. GM will unveil its first post-bankruptcy earnings report today and will begin making $1 billion quarterly installments on the loan on December 31. Also, the $1.4 billion loan to Canada will also be repayed to Canada at a rate of $200 million per quarter.
For those who don't know, General Motors wasn't required to make any payments on the U.S. loan before July 2015, but due to the strong vehicle sales the American manufacturer decided to begin repaying its debts. "The reason GM is in a position to do that is that they have seen performance that has been modestly ahead of what the expectation was when GM went into bankruptcy and emerged from bankruptcy," says Automotive's News source. Also, the vehicle sales fell off less than expected during GM's government-supported bankruptcy in June and July. [via autonews]
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