Many voters were quite upset when the Federal Government bailed out the US automakers.
When Lee Iacocca a few decades ago introduced the concept of "Too Big to Fail" and the US government sponsored the Chrysler bailout, many folks shook their heads back then, but they pulled it off, and everything turned out fine.
Some folks thought that was unfortunate as if things had turned out badly and it was later considered a bad financial decision in hindsight, there probably wouldn't have been bailouts in the future.
But that's not the way history played out, and then we had the global economic crisis and the US government bailed out Chrysler again, and General Motors too.
Chrysler Motor Acceptance Corporation and GMAC were also hit fairly hard.
In fact they stopped making automobile loans for a while, which hurts sales even worse.
That was a lot of reorganization to do, and there were bankruptcy issues, dealer network reduction cuts, union pension funds were paid, and lastly the government had to be paid back.
There was an interesting article in the Wall Street Journal on May 20, 2011 titled "Chrysler Nears Bailout Repayment - Auto Maker Raises $7.
5 Billion in New Debt After a Second Restructuring" by Kate Burke.
And the other companies that took US government bailout monies either have paid them back or will have completed their payback schedules soon, thus, perhaps all of these US Car Makers will be able to lower the prices of their cars now, or offer better financing terms through their financing arm subsidiaries? In doing so, they will win back the respect of the American Consumer and set themselves up to be in a competitive place as Chinese, Russian, and Indian automakers bring in their low-cost hybrids, and mini-cars into the US Markets.
Either the US auto companies can compete in this new global economy by getting tough, sharpening their teeth, and getting it done the "American Way!" or it's going to be a rough future in the sector.
My question is now that the US automakers have paid back the bailout money will they be doing more in-house lending for their automobiles, offering better incentives, interest rates, and terms to consumers who buy their cars? Will they also be able to lower the price of cars for the American public, and put themselves into a position where they can compete against the impending competition? Indeed, I would believe the answer is yes, but I'd like you to please consider all this and think on it.
If you have any comments about the American auto industry please shoot me an e-mail.