WASHINGTON — The Treasury Department said Thursday it has sold an additional 70.2-million shares of General Motors Co. stock acquired as part of the automaker's bailout and expects to unload the rest by the end of the year.
The sale of the final 31.1-million shares would close the books on GM's $51-billion rescue. The Obama administration expects to post a $10-billion loss on the bailout, although officials have said they never expected to turn a profit and that saving the auto industry was crucial to the economic recovery.
The latest sale of GM stock took place over about two months and reduced the government's ownership stake to 2.2%. At its height after the 2008-2009 bailout, taxpayers owned 60.8% of the Detroit company after a government-led restructuring.
The 70.2-million shares were sold for $2.56 billion, the Treasury Department said. It plans to sell the remaining shares by the end of the year, subject to market conditions.
So far, the Treasury said it has recovered $38.4 billion of the money pumped into GM from the $700-billion Troubled Asset Relief Program bailout fund to keep the legendary automaker from failing.
The Treasury also rescued Chrysler Group with a $12.5-billion bailout. The Treasury closed the books on that rescue in 2011 and took about a $1.3-billion loss.
Obama administration officials have said the bailouts, begun under former President George W. Bush, were successful even though they ultimately will result in a loss because they helped keep the U.S. auto industry from collapsing in the depths of the Great Recession.
“Treasury’s investment in the American auto industry was part of President Obama’s broader response to the financial crisis, and it helped save more than 1-million jobs,” Treasury Deputy Assistant Secretary Tim Bowler said Thursday.
“Had we not acted to support the automotive industry, the cost to the country would have been substantial, in terms of lost jobs, lost tax revenue, reduced economic production and other consequences," he said. "Our actions have enabled the industry to rebound."
Bowler said that GM, Chrysler and Ford Motor Co., which was not bailed out, are all now profitable. The industry has added 340,000 new jobs since GM and Chrysler emerged from their government-led restructurings in 2009, he said.
Altogether, the government spent $79 billion to rescue the auto industry, including bailouts for the financing arms of GM and Chrysler.
The administration expects the loss on those bailouts to be about $15 billion. The nonpartisan Congressional Budget Office estimated a $17-billion loss on the auto industry rescue in its latest estimate in May.