The middle of 2009 caught General Motors in a very problematic situation, as it was bailed out by the USA and Canadian governments. It then promised to start fresh, with the main focus being to turn a profit as soon as possible.
So, you would think the company managed to at least refrain from losing too much money after it was bailed out, right? Well, not that much, as GM revealed a $4.3 billion loss for the second half of 2009. Before you ready the pitchforks though, there were some reasons behind this huge amount.
First off, $2.6 billion went to the retiree medical plan for UAW members, while another $1.6 billion were spent on “foreign currency re-measurement loss.” Still, things look pretty good for GM, as it revealed that:
“As the results for 2009 show there is still significant work to be done. However, I continue to believe we have a chance of achieving profitability in 2010,” said Chris Liddell, GM vice chairman and CFO. “We are also dedicated to delivering on our commitments to our stakeholders. For example we remain committed to repaying the outstanding balance of the U.S. Treasury and Export Development Canada loans by June 2010 at the latest.”
Are you confident in GM turning a profit and being capable of repaying the government loans? Share your thoughts below.
Source: GM
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