It looks as though General Motors (GM) may be able to pay back more of the federal Trouble Asset Relief Program (TARP) than was previously estimated, due to the fact that its share price has risen significantly in the recent months. General Motors has a 52 week low of around $19 per share and a 52 week high of around $33 per share and, having dipped significantly leading into the beginning of January, it is currently on the rise, sitting right around $24 per share. The recent improvement is very important because it will have an impact on the repayment of the TARP money.
American International Group (AIG), another company aided by TARP, has also seen some significant improvement in share price recently. AIG stock climbed about 32% in price, while General Motors rose about 22%. Coupled together, these two companies are expected to repay about $8 billion more than previously anticipated. Of course, this does not guarantee that this money will come through, but it certainly is encouraging that TARP might not cost the taxpayers as much as was originally thought.
While General Motor’s stock price has been rising, its share of the American car market dwindled. A recent decline in the number of new products has been a driving force behind this slide. Another factor has been the company’s decision to roll back incentives. The share of the American car market that General Motors currently controls has dipped to 17.5%, which is down significantly from the 19.6% market share at the end of last year.To continue reading, click here.