Following the auto bailout of GM and Chrysler a number of years ago, General Motors has posted a profit for first quarter of 2010. The company has not posted profits given that 2007. GM recently repaid a portion of the auto bailout it was lent and is thought to be on the path to profitability. Ford also posted profits, and it appears the auto companies are beginning to pay back their emergency loans and righting course.
First Quarter Gains for GM
For the first time since 2007, GM has posted a first quarter profit. The New York Times reports that GM recorded a profit of $ 865 million. They had revenues of $ 31.5 billion, and liquid cash of upwards of $ 1 billion. The business had previously requested and received a $ 50 billion bailout from the government, and have seemed to turn themselves right around. The first quarter of a year ago had GM posting a loss of $ 6 billion.
Payment on the loans begun
Last month, GM made payments on part of the loans made by the Treasury. Part of the bundle of loans made to GM and Chrysler has been repaid by GM years ahead of schedule. While this was touted as a victory by GM and also Chief Executive Ed Whitacre, it was only a payment of $ 8.2 billion to the governments of The US and Canada.
Not totally done
GM is still heavily in debt, though they’ve begun to show profits. The loans it received from the US and Canadian governments totaled a lot more than $ 50 billion. GM has been making clear good strides but isn’t totally free yet. GM can only divest the 60 percent or a lot more of ownership shares the US Treasury owns by public stock offerings. They intend to make a public offering by the end of year.
Sources
New York Times
http://www.nytimes.com/2010/05/18/business/18auto.html?src=mv
