General Motors Co and Chrysler are now on an orderly course a year after their government-brokered bankruptcies, with the Obama administration hopeful GM can seek a public offering of shares this year.
A report released by the White House one day before President Barack Obama visits auto plants in Detroit touted added production shifts, a healthier supply base, stronger sales, increasing exports and fresh investor optimism overall for the sector.
We think there's a lot of signs that, while slow, the industry is truly coming back, Ron Bloom, Obama's point man for auto industry restructuring, told reporters on Thursday.
We're on an orderly course, Bloom said, highlighting turnarounds at Chrysler and GM especially.
Bloom would not discuss specifics of a widely anticipated GM Initial Public Offering of shares that would enable the government to begin selling its stake.
We are hopeful that it can be accomplished this year, he said.
Bloom said the administration did not have any visibility on when Chrysler could do the same. Chrysler is under management control of Italy's Fiat SpA.
The Treasury's 60 percent stake in GM is mostly held in common equity with a lesser amount in preferred shares. Much of the Chrysler stake is debt with a small percentage in common stock.
The United Auto Workers union, which owns 17 percent of GM, said in a separate statement the automaker plans to disclose its IPO plans to regulators in mid-August. But the union later retracted that statement, saying it was based on media reports and did not have any inside information.
A GM spokesman said the IPO will be launched when the conditions are right.
Bloom would not discuss how much of the stake Treasury would seek to sell in a first GM public offering. But sources have told Reuters the government would set aside up to 24 percent at that time.
Obama told ABC's The View program he expects to recoup taxpayer bailout funds from the industry, which include $50 billion to GM, more than $14 billion for Chrysler, $5 billion for suppliers since early 2009. More money went into auto financing.
Spokesman Robert Gibbs said the goal is to get all of it back -- some $85 billion spanning both the Bush and Obama administrations. Bloom said the government would break even on the current administration's outlay of roughly $60 billion, if it were to cash in right now.
But Bloom said the Treasury would not rush the companies to market and would proceed deliberately on any sale.
We recognize people don't want us to own the company. We don't want to own the company, Bloom said. But to do it at a fire sale, I think, is irresponsible to the taxpayers. So it's a careful walk and we're going to walk it carefully.
GM chief executive Ed Whitacre said earlier this year that the goal of his company was to repay taxpayers in full.
GM used unspent bailout funds earlier this year to retire a $7 billion loan. The Treasury has recouped about $2 billion so far from Chrysler. And the White House report said on Thursday suppliers are ending their bailout program this month and fully repaying the $5 billion in aid that they received.
(Reporting by Caren Bohan and John Crawley; additional reporting by David Bailey in Detroit and Soyoung Kim in New York)