Two years ago, on June 1, 2009, General Motors filed for bankruptcy, backed by $30 billion in support from the federal government. The same day, in the same New York courthouse, a judge approved Chrysler’s plan to forge an alliance with Fiat and emerge from bankruptcy as a restructured business with an uncertain future.
Two years later the American auto industry is mounting a comeback.
Today, the White House released a report that highlights the resurgence of the American auto industry. The report discusses the jobs created in the sector, the turnaround of the companies that are now turning a profit, and how entire communities have been revitalized by a strengthened auto industry.
In the year before GM and Chrysler filed for bankruptcy, the auto industry shed over 400,000 jobs. Had President Obama failed to intervene, conservative estimates suggest that it would have cost at least an additional one million jobs and devastated vast parts of our nation’s industrial heartland. Since GM and Chrysler Group emerged from bankruptcy in June 2009, the auto industry has added 115,000 jobs – the fastest pace of job growth in the auto industry since 1998.
Since GM and Chrysler emerged from bankruptcy in June 2009, they have announced investments totaling over $8 billion in their U.S. facilities, creating or saving nearly 20,000 jobs. Additionally, in the first quarter of 2011, the auto industry reached an important milestone when all three Detroit automakers posted positive quarterly net profits – for the first time since 2004.
Furthermore, both companies are paying back their loans. Last week Chrysler repaid its outstanding loans to the U.S. Treasury, bringing the total amount taxpayer dollars returned to $10.6 billion – which represents a full recovery on the resources committed by the Obama Administration.
As Treasury Secretary Tim Geithner said in an op-ed in The Washington Post today:
“What happens next for Chrysler and GM is up to their executives, managers and workers — just as with any other company. We cannot guarantee their success, and at some point they may stumble. But we’ve given them a better shot. The choice to stop the American automobile industry from unraveling was the right one.”