Fiat Rescues Chrysler

Posted: Jun. 2nd, 2011  |  By JustLuxe Team

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After news that Chrysler had paid back part of its debt from the 2008-2009 auto recovery bailouts, in the amount of $7.6 billion to U.S. and Canadian governments, Fiat has notified the U.S. Treasury that they would be buying out the last 6% of the government’s ownership. This will bring Fiat’s investment in the company up to 52%. Price negotiations are underway, and the loan repayment will not be as much as what is due back to the government. Which means the tax payers will still be out about $2 billion of the $10.5 billion bailout from Chrysler. The government does not believe that money will be recovered.

Fiat could be getting a larger piece of the pie, if it gets the last 5% stake owned by the government, and the stake currently held by the United Auto Workers Health Trust, which would bring Fiat’s ownership of Chrysler to 70%.