Chrysler received over a billion dollars in loans from the Canadian government during the 2009 financial crisis, according to recently uncovered documents.
And now they’ll never have to pay it back.
Back in 2008 and 2009, it wasn’t exactly a secret that automotive companies were getting government bailouts left and right in both the US and Canada. Our northerly neighbors were particularly gung-ho about saving their auto industry simply because it’s a huge employer for Canuckistan, and the death of even one car company would have huge rippling effects on the Canadian economy.
According to documents recently unearthed by the CBC, Chrysler received an enormous $1.125 billion loan from the Canadian government--a loan that Canada no longer expects to ever get back.
It looks like the Canadian federal government was even trying to hide this little financial hiccup, too. The line about the Chrysler loan wasn’t even properly labeled in the 2018 Public Accounts of Canada volume that was tabled in Parliament Friday. All that it said was that the loan was written-off and tagged as a loss for the current year’s financials.
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This might seem a little bit confusing considering Chrysler as a name still exists within the merged entity of Fiat Chrysler Automotive (which made $4.7 billion in profits last year), but there’s a reason why Canada isn’t going after them to get their money back.
Back in 2009 at the height of the crisis, Chrysler was split in two: one half of Chrysler was called “Old Chrysler”, while the other half was called “New Chrysler.” New Chrysler was financially viable on its own and didn’t need a bailout, while Old Chrysler was in dire straights. Canada and the US funded OId Chrysler to try and save it, but it still went bankrupt and defaulted on all its loans. Meanwhile, New Chrysler got bought-up by Fiat to become Fiat Chrysler, and the rest is history.
In total, Canada spent roughly $13.7 billion on auto loans during the 2009 financial crisis, losing about $3.4 billion on the deal--a loss of about 27%. According to Jalopnik, the US spent $85 billion and lost $9 billion, which is a little over 10%.
So whenever you look back on all the money the government wasted trying to bail out failing car execs, just remember that it could have been worse. You could be Canadian.