WASHINGTON -- The federal government on Monday sold its remaining shares of General Motors Co. stock, ending the controversial $49.5-billion bailout of the automaker with an approximately $10.5-billion loss for taxpayers.
“This marks one of the final chapters in the administration’s efforts to protect the broader economy by providing support to the automobile industry,” Treasury Secretary Jacob J. Lew said.
President Obama’s decision to continue the bailouts of GM and Chrysler, begun in late 2008 under former President George W. Bush, helped avoid a collapse of the U.S. auto industry, Lew said.
Obama tied the additional money to requirements that GM and Chrysler go through government-led bankruptcy restructurings that left taxpayers owning parts of both companies.
In 2011, Treasury closed the books on its $12.5-billion bailout of Chrysler and took about a $1.3-billion loss.
At its height, taxpayers had a 60.8% ownership stake in GM. Treasury began selling shares after the restructured company held an initial public offering in 2010.
Last month, Treasury reduced its GM stake to 2.2% and said it planned to sell the rest of the stock by year’s end. Over the last few weeks, Treasury sold the approximately 30 million shares it had left, with the final sale coming Monday.
GM Chief Executive Dan Akerson said the end of the bailout was just another chapter in the company’s turnaround.
“We will always be grateful for the second chance extended to us, and we are doing our best to make the most of it,” he said.
Although the GM and Chrysler bailouts ended with a loss for taxpayers, Treasury officials said the goal never was to turn a profit. The rescues prevented further damage to the economy and the potential loss of 1 million jobs, Lew said.
Earlier Monday, the Center for Automotive Research, a Michigan think tank, estimated the goverment would lose $13.7 billion on the GM and Chrysler bailouts. But the center said the rescues provided a net economic gain for the country and saved about 2.6 million jobs.