Chrysler CEO Sergio Marchionne said refinancing the company's two loans would mean no longer having to explain the "shyster rates."
SAN FRANCISCO — Chrysler's CEO apologized Saturday for the way he described the interest rates the U.S. and Canadian governments are charging on the bailouts his company received in 2008 and 2009.
Sergio Marchionne, speaking Friday during an automotive conference in San Francisco, called the interest rates a “thorn” in his side and said that refinancing the two loans would mean no longer having to explain the “shyster rates.”
In a statement posted at the center of Chrysler's home page Saturday, Marchionne said he regrets a term he used and considers it “inappropriate.”
“Yesterday, in responding to a question about Chrysler's government loans, I used a term in reference to the interest rate being charged on our government loans that has raised concern,” Marchionne's statement said. “I regret the remark, which I consider inappropriate.”
Marchionne said Chrysler remains grateful for the bailouts and noted that no other parties were willing to assist in Chrysler's recovery.
“The two governments levied interest rates that, although appropriate at the time, are above current market conditions,” he continued. “This was done with the full support and understanding of the members of Chrysler Group LLC.”
Chrysler hopes to reach a deal with banks by the end of March to refinance the loans, which carry rates of 11 to 12 percent. It owes the U.S. government $5.8 billion and the Canadian government $1.3 billion.
The two governments also took ownership stakes in Chrysler when it came out of bankruptcy protection in June 2009. The U.S. stake is now at 9 percent while the Canadian stake stands at 2 percent.
The governments hope to be repaid for those investments when Chrysler's stock is sold to the public. It hasn't been traded as a separate company since it was taken over by German automaker Daimler in 1998.
The term “shyster,” probably derived from German, usually refers to an unscrupulous or unethical person, according to Webster's II New College Dictionary.