In total, Treasury invested approximately $80 billion in the automotive industry. As of October 31, 2013,
we have recovered $54.6
billion, and while we do expect some fiscal cost from the program, it will be far less than anticipated when the program began. Moreover, the program succeeded in its goal of rescuing the American automotive industry and saving a million jobs. For the latest cost estimates, see the most recent Monthly Report to Congress or the TARP Tracker.
While the industry continues to face challenges, GM, Chrysler, and Ford have returned to profitability. An estimated one million jobs were saved by the assistance provided under TARP. This assistance made it possible for them to restructure and compete more effectively. As a result, since 2009 the auto industry has continued to rebound.
On December 19, 2012 Treasury announced its intent to fully exit its investment in General Motors (GM) within the next 12-15 months, subject to market conditions. Two days later, GM purchased 200 million shares of its common stock from Treasury at $27.50 per share, for proceeds of approximately $5.5 billion.
Several recent transactions have further reduced Treasury's outstanding investmetn in GM:
- On April 11, 2013, Treasury completed its first pre-arranged trading plan for the sale of its GM common stock. Under this plan, Treasury sold 58.4 million shares of GM common stock for total gross proceeds of approximately $1.6 billion.
- On June 6, 2013, Treasury commenced its second pre-arranged written trading plan and sold 30 million additional shares of GM common stock at $34.41 per share, in an underwritten public offering in conjunction with GM's inclusion in the S&P 500 index. The aggregate proceeds to Treasury from the sale were approximately $1.03 billion. The UAW Retiree Medical Benefits Trust (VEBA) also sold 20 million shares in the offering, making the total offering size 50 million shares. Aggregate proceeds to VEBA from the comon stock offering were approximately $688 million.
As of October 31, 2013, Treasury had collected approximately $37.2 billion of its original $51.03 billion investment in GM through repayments, sale of stock, dividends, interest and other income. Treasury intends to continue selling its remaining shares in an orderly fashion, subject to market conditions.
In May 2011, Chrysler repaid its outstanding TARP loans
six years ahead of schedule. More than $11.2 billion of the $12.5 billion committed to Chrysler has been returned to taxpayers through principal repayments, interest, and cancelled commitments. Treasury has exited its investment in Chrysler Group LLC (New Chrysler) and is unlikely to fully recover the difference of $1.3 billion owed by Old Chrysler.
To date, Treasury has recovered nearly 40% ($6.21 billion) of $16.3 billion invested in Ally through repayments and other income. Treasury continues to monitor Ally Financial’s performance and evaluate options to exit its investment, which consists of 74 percent of Ally common equity and $5.9 billion of mandatory convertible preferred stock.