Treasury provided a total of $12.5 billion to Chrysler and its financing arm after the recession hampered auto sales and sent Chrysler and General Motors to the brink of collapse. The funds came from the government's $700 billion [COLOR=blue! important][COLOR=blue! important]bank[/COLOR][/COLOR] bailout fund.
Since then, $11.2 billion of the assistance has been repaid, Treasury said. Chrysler repaid $5.1 billion in loans from the government in May. But the $1.3 billion remaining is unlikely to be recovered, Treasury said.Taxpayer money was used to "give" an Italian company a controlling interest in a US auto maker?The purchase of the government's stake gives Fiat 52 percent ownership of Chrysler. That's likely to rise to 57 percent before the end of the year when Chrysler begins producing a 40 mpg small car in the U.S.
Fiat received a 20 percent stake in Chrysler after the bankruptcy in exchange for [COLOR=blue! important][COLOR=blue! important]management[/COLOR][/COLOR] expertise and technology. The Italian automaker has gradually raised its stake by meeting benchmarks set by the government.