Treasury exits Chrysler bailout with $1.3-billion loss
Italian automaker Fiat purchased the U.S. government's 6% stake in Chrysler for $560 million, formally concluding the $12.5-billion bailout in 2008 and 2009, Treasury announced. Including Chrysler's payment of loans from the Troubled Asset Relief Program, or TARP, the government received $11.2 billion of the money back.
As it has indicated before, Treasury is unlikely to recover the remaining $1.3 billion. But Tim Massad, the Treasury assistant secretary who oversees the TARP program, declared the bailout a success.
“With today's closing, the U.S. government has exited its investment in Chrysler at least six years earlier than expected,” he said. "This is a major accomplishment and further evidence of the success of the administration’s actions to assist the US auto industry, which helped save a million jobs during the worst economic crisis since the Great Depression."
Administration officials projected in June that the $80 billion in bailouts of Chrysler and General Motors would lose a combined $14 billion, about a third of what was originally projected when the government forced both into bankruptcy restructuring in 2009.
In May, Chrysler reported its first quarterly profit since emerging from bankruptcy in 2009.
-- Jim Puzzanghera
Photo: A Chrysler Sebring at the 2010 New York International Auto Show. Credit: Reuters