It's a great day for Chrysler and the American taxpayer as the once-bankrupt automaker is set to repay $7.5 billion in loans, including interest, to the U.S. and Canadian governments.
You'll recall that Chrysler CEO Sergio Marchionne once referred to the debt as "shyster loans" because of the high rate of interest some of the loans carried. (He later apologized.) Chrysler is refinancing that debt by obtaining new bank loans with better terms, much in the same way you or I would refinance a home mortgage.
Detroit News business columnist Dan Howes writes--correctly--that repaying the loans four years early validates the Obama administration's decision two years ago to rescue the automaker at a time when many thought Chrysler was too sick to survive.
There's certainly much to be done to ensure its long-term success, but Marchionne has done a masterful job of bring Chrysler this far. And the company's relationship with Italian automaker Fiat looks like a far better fit than the disastrous DaimlerChrysler hookup.
A Chrysler spokesman told me today's loan repayment ceremony at the Sterling Heights Assembly plant won't be as flashy as the event nearly 30 years ago when then-Chrysler Chairman Lee Iacocca displayed a huge cardboard check, representing repayment of Chrysler bailout loans seven years ahead of schedule.
"We're in a direct-deposit kind of world today," the spokesman said.
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