Wheels24

Auto bailout taxes US taxpayers

2012-08-14 10:58

WASHINGTON, US - The US Treasury Department has said the auto industry bailout will cost taxpayers $3.4-billion (R27.6-billion) more than previously thought.


The department said it estimated the 2009 bailout will eventually cost the government $25.1-billion (R203.6-billion), according to a report sent to the country's Congress. That is up from the last quarterly estimate of $21.7-billion (R176-billion).


BIG THREE - FROM CRISIS TO PROFIT


Since the billion-dollar bailout of the US auto industry, Detroit's big automakers have moved from crisis to profit. GM and Chrysler were put through government-funded bankruptcies that slashed costs and debt.


Treasury has so far recouped about half of what was extended in grants and loans to GM and Chrysler, their related retail financing arms and suppliers. Some of the money was repaid in cash, while the remaining interest was tied up in equity shares held by the government.

Reuters