In case you missed it, your $85 billion bailout investment of General Motors and Chrysler will cost you $34 billion, the Congressional Budget Office estimates, but give GM credit for trying to return your money.
GM posted a $865 million first quarter profit for the first time since 2007 but Chief Financial Officer Chris Liddell cautioned not to set your hopes too high. Production increased 57% from year-end levels with improved U.S. demand and much stronger sales in China.
However, the company lost $506 million with its Opel brand in Europe.
The CEO said it was too early to predict when GM will launch a stock offering which would reduce a portion of the U.S. Treasury's nearly 61% ownership in the company. He said first-quarter capital spending was almost $1 billion less than GM plans for the remaining three quarters.
Liddell said GM is trying to buy back its consumer financing arm, GMAC, which it sold in 2006 to raise cash. It was purchased by Ally Financial which is 56% owned by the U.S. Treasury as a result of a $17 billion infusion as part of the bankruptcy restructuring.
GM has repaid the government $7 billion and owes $43 billion.
"They're headed in the right direction, but one quarter is not going to turn the ship around," said Mirko Mikelic, a portfolio manager for Fifth Third Asset Management.
Chrysler is still in the pits. Now operating under the control of Fiat, Chrysler posted a net first quarter loss of $197 million. Of the $15.5 million in bailout loans, Treasury said $3.9 billion has been repaid and chances of recouping another $500 million are good. Beyond that, taxpayers will eat the remains.
Chrysler is in no position to offer a stock offering for several years in which the government holds a 10% stake. Chrysler Holding is the parent company of the old Chrysler. It is owned by private equity firm Cerberus Capital Management. Cerberus bought Chrysler from Daimler AG in 2007.
Meanwhile, Ford Motor Co. which refused bailout money, reported a first quarter profit of $2.1 billion and forecast it will be solidly profitable by the end of 2010.
U.S. auto sales have benefited from the recall of thousands of Toyotas because of accelerator and other defects but the Japanese firm still outsells the American products in U.S. markets.