In total, Treasury invested approximately $80 billion in the automotive industry. As of January 31, 2014
we have recovered $66.1
billion (or 82.5%), 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 9, 2013, Treasury announced that
it had fully exited its investment in GM following the sale of all of its
remaining shares of GM common stock. In total, Treasury collected proceeds of
$39.7 billion from all of its investments in GM through repayments, sales of
stock, dividends, interest, and other income.
TREASURY’S DISPOSITION OF GM COMMON STOCK
In November 2010, GM completed an initial public
offering, which yielded $13.5 billion in net proceeds for Treasury and reduced
its stake in GM to 500.1 million remaining shares of GM common stock. In
December 2012, as part of its continuing efforts to wind down TARP, Treasury
announced its intent to fully exit its remaining investment in GM within the
following 12-15 months, subject to market conditions. As part of that
announcement, GM agreed to purchase 200 million shares of GM common stock from
Treasury at $27.50 per share – a transaction that closed on December 21, 2012.
In January 2013, Treasury began the process of selling its remaining 300.1
million shares through pre-arranged trading plans.
- 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 common stock offering were approximately $688 million.
- On November 21, 2013
Treasury announced that the third pre-defined trading plan was complete with
the sale of 70.2 million shares of GM common stock.
- On December 9, 2013
Treasury completed the sale of all its remaining GM common stock thus exiting
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.
In early November 2013,
Ally returned $5.9 billion to taxpayers. Including that amount Treasury has
recovered more than 70% ($12.3 billion) of $16.3 billion invested in Ally
through repayments and other income. Taxpayers are now in a stronger position
to maximize the value of their remaining investment in Ally. Treasury is continuing to work with the
company to further wind down this investment through either a public offering,
private sale of its common shares or further sales of assets.
In January 2014, Treasury sold 410,000 shares of Ally Financial, Inc. common stock in a private offering at $7,373 per share, for approximate proceeds of $3.0 billion. Following this sale, taxpayers still hold roughly 571,971 shares or 37 percent, of common stock in the company, and will have recovered approximately $15.3 billion, or 89 percent of the $17.2 billion investment provided to Ally during the financial crisis.