Car Deals

Detroit, MI, United States (AHN) – Chrysler Group LLC has repaid the American and Canadian loans it received after filing for Chapter 11 bankruptcy in April 2009.

After being purchased by Italian carmaker Fiat and turning around lagging sales, on Tuesday Chrysler repaid $1.7 billion to Canada and $5.9 billion to the U.S. Treasury.

The announcement comes after Chrysler posted its best April sales since 2008. Chrysler enjoyed the 13th-consecutive month of year-over-year sales gains as April rose 37 percent over the same period a year ago.

The repayment is also good news for the Obama administration as the president looks to defend the controversial auto industry bail-out ahead of reelection in 2012.

“Chrysler’s repayment of its outstanding loans to the U.S. Treasury and American taxpayers marks a significant milestone for the turnaround of Chrysler and the countless communities and families who rely on the American auto industry,” Obama said Tuesday. “This announcement comes six years ahead of schedule and just two years after emerging from bankruptcy, allowing Chrysler to build on its progress and continue to grow as the economy recovers.”

“Supporting the American auto industry required making some tough decisions, but I was not willing to walk away from the workers at Chrysler and the communities that rely on this iconic American company. I said if Chrysler and all its stakeholders were willing to take the difficult steps necessary to become more competitive, America would stand by them, and we did,” Obama added.

The Treasury Department was also glad to hear the risky investment paid off. Former President George W. Bush issued a $13.4 billion bail-out loan for several American car makers in 2008. Yet, that year Chrysler saw sales fall 34.9 percent in just 12 months. After the bail-out, Obama pledged to guarantee the billions in loans Chrysler had received, even if the company completely failed.

“Because President Obama made the tough decision to stand behind and restructure the auto industry, America’s automakers are growing stronger, making new investments, and creating new jobs today throughout our nation’s industrial heartland,” U.S. Treasury Secretary Tim Geithner said. “Chrysler’s early repayment of its outstanding [Troubled Asset Relief Program] loans is an important step in the turnaround of this company.”

View full post on Economy, Business And Finance Stories