GM Pressured Treasury Department To Take $14 Billion Loss In Share Buyback

The Treasury Department's decision to sell 200 million shares back to General Motors Co. and outline a final exit plan by early 2014 marks the beginning of the end of the government's historic intervention in the U.S. auto industry.

The final exit plan, negotiated in just six days and approved by GM's board of directors on a conference call late Tuesday, comes after the automaker pushed since 2010 to get the government to exit.

GM executives have long believed the exit would help GM sell more cars to buyers who are turned off by the derisive "Government Motors" nickname — and boost the automaker's stock price.

But the plan isn't without steep costs: Taxpayers are on the hook for billions in losses — about $13 billion on paper. The final tally will rise or fall based on the stock price as the government sells its final 300 million shares by March 2014, likely in a series of small sales.

Steve - 12/20/2012 1:18:57 PM

+4 Boost

Sure, blame GM for "making" the Feds do something (i.e., "pressuring" them). I say, take accountability for your decisions, and don't blame others! The government decided to borrow money they didn't have and gift it to a failing giga enterprise, and hand the bill to American tax-payers. That sucks, in my opinion :-(

vdiv - 12/20/2012 3:17:47 PM

+2 Boost

Wait, wait, wait, wait!

GM pressured the FED to take the money?!

Gee, I want to be pressured the same way too!

HughJass - 12/20/2012 4:39:38 PM

+4 Boost

The Fed gave GM $10 and GM pressured the Fed to to take $5 back as payment and call it even. Still sound like a deal to you?

PLAY - 12/20/2012 9:55:08 PM

+4 Boost

Big mistake. The government should have insisted on a share buyback that would have incurred no loss to the government.

Lexus - 12/21/2012 12:58:35 AM

0 Boost

Hey autospies,

you forgot to make a post for this ; )

http://www.insideline.com/hyundai/veloster/2012/2012-hyundai-veloster-recalled-for-parking-brake-problem.html

Oh..., And happy holiday!! ; )

Ford77 - 12/21/2012 7:29:48 PM

+2 Boost

GM just idled four more plants. That tells you something about their products. Next thing you'll see is the government running ads for you to buy a GM vehicle. That'll be the day!! Hasn't the taxpayer taken enough of a loss on this mismanaged company.