Now that its government loans are repaid, Chrysler Group LLC hopes consumers will measure it — and make it solidly profitable — by buying its cars and trucks.
As expected Tuesday, Auburn Hills-based Chrysler repaid $7.6 billion in outstanding loans, interest and fees. That wipes its slate clean with the U.S. and Canadian governments less than two years after government bailouts kept Chrysler and General Motors Co. in business.
They didn't repay the loan, they refinanced the debt to lower their interest rate. Borrowing money from Peter to pay Paul for the money you borrowed from him isn't paying off the loan, it's shuffling the debt. Any bets out there that the terms of the new loan included some form of guarantee being issued by the government that the new lender would get paid? After the general government violated every known bankruptcy law and shafted the last set of secured lenders I can't imagine that anyone else would be foolish enough to lend that amount of capital facing the risk of having the politicians shaft them as well.
That, and the taxpayers are still stockholders in the company.
Amazing too is that the financial strength of the company continues to be found in the profitable truck and SUV market, not fuel efficient cars. With the assault on oil seemingly firmly entrenched, what do you think their future prospects are in a world of $4 or $5 a gallon fuel?
