General Motors to repay U.S., Canadian loans by June

Mark Reuss, President of General Motors (North America) speaks to the media before the 2010 Chicago Auto Show on Wednesday.

U.S. automaker General Motors will repay the federal loans, which it received to come out of bankruptcy, to the American and Canadian governments by June this year, a top executive of the company has said.

“We plan to repay our U.S. and Canadian loans by June of this year,” General Motors (GM) North America President Mark Reuss said in his address on the first day of the Chicago Auto Show here.

GM, which had entered into bankruptcy protection on June 1, 2009, will now repay the full USD 6.7 billion investment made under the Troubled Asset Relief Programme (TARP) along with USD 1.4 billion in repayments to the Canadian and Ontario governments by June.

Ruess said GM is making rapid progress and the company now has a “clean, substantially de-leveraged balance sheet for the first time in more than a decade“.

The company is constantly making efforts to improve its cost structure, repay its loans and focus on fundamentals of designing, building and selling “the world’s best vehicles“.

At the time of bankruptcy, the automaker had liabilities of USD 172.8 billion and USD 48.4 billion of debt.

Under a massive government bailout package, GM had received USD 49.5 billion. It emerged from bankruptcy protection in July last year, with the U.S. government obtaining 61 per cent and the Canadian government receiving 11.7 per cent stake in the new company.

Ruess also said GM will try to improve relations with its dealers after sending termination notices to about 2,000 retailers last year.

Aiming to connect better with its customers, GM’s chief said he is now using social networking site Facebook and email to communicate directly with customers who have complaints about their vehicles.

“Our overriding goal is excellence in product and customer service. Good enough does not cut it any more,” he said.

Reuss also said the company’s eagerly awaited electric-powered Chevrolet Volt would be ready to debut in a few months. The Volt charges up much like a laptop and its electric-motor battery pack plugs into a 3-prong outlet for a juice-up.