Chrysler repays bailout loans early

Chrysler has paid back 5.4 billion euros worth of loans to the US and Canadian governments from its 2009 bailout.

Chief executive Sergio Marchionne said the carmaker had been given a rare second chance after going “to hell and back”.

He told a gathering of workers at a suburban Detroit assembly plant: “We are changing both the image and substance of our group and are regaining the faith of the public at large.”

Repaying the money – six years ahead of schedule – allows Chrysler to distance itself from an unpopular bailout and deepen its ties with Italian manufacturer Fiat, which Marchionne also heads.

President Barack Obama called the payback a “significant milestone” and a sign the US auto industry is recovering. He made the comments during a visit to London.

The repayment puts Chrysler on firmer financial ground and draws it closer to Fiat, two goals that investors and bankers have said would make Chrysler more attractive in an initial public offering that could come this year or next.

As a result of the loan repayments, Fiat’s stake in Chrysler has risen to 46 percent, making it the largest single shareholder and putting the Italians within striking distance of their 51 percent goal in 2011

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