New CarCo Acquisition LLC
Date:
May 27, 2009
Maximum Amount:
$7.14 billion
Deficit Impact:
-$0.39 billion New Carco Acquisition was a temporary name given to New Chrysler once the government approved Old Chrysler's future viability plan and Fiat established a new company in place of Old Chrysler. Old Chrysler sold all of its operating assets to New Chrysler in exchange for assuming some of the liabilities of Old Chrysler. New Chrysler paid Old Chrysler a total of $2 billion in cash for the transfer.
Once established, the government provided over $6.5 billion in debt obligations for the new company, now owned by Fiat, to avoid the possibility of failure and any negative market impact that business collapse could carry with it.
On May 24, 2011, Chrysler repaid $5.1 billion of this loan and terminated its ability to draw the other $2.1 billion, representing a full repayment.
Notes:
Amount spent indicates loans and other funds issued as of 5/25/2011 (http://www.ustreas.gov/initiatives/eesa/transactions.shtml). Maximum amount is original loan amount. Deficit impact calculated by CRFB, using CBO's practice of estimating costs on a risk-adjusted present value basis. Deficit impact is derived from CBO's overall subsidy rate for assistance to the automobile industry (60%), as listed in CBO's January 2010 baseline.