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Ford, Nissan, Tesla expected to get US loans

Program is for fuel-efficient cars

By Ken Thomas
Associated Press / June 23, 2009
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WASHINGTON - The Energy Department is lending money to Ford Motor Co. and two other automakers from a $25 billion fund to develop fuel-efficient vehicles, congressional officials said yesterday.

Energy Secretary Steven Chu was scheduled to announce the loan funding for Ford, Nissan Motor Co., and Tesla Motors Inc. today in Dearborn, Mich., the officials said. They requested anonymity because an official announcement was pending.

Dozens of auto companies, suppliers, and battery makers have sought a total of $38 billion from the loan program. Ford has asked to receive $5 billion in loans by 2011, but it was unclear how much money the automaker would receive. Nissan has applied for an undisclosed amount of assistance, while Tesla has sought $450 million.

The Energy Department declined to comment on the plans. Chu has not yet announced the first recipients of the loans, which have been closely watched by lawmakers from states with auto plants and suppliers.

Congress approved the loan program last year to help car companies and suppliers retool their facilities to develop green vehicles and components such as advanced batteries.

The loans were designed to help the auto manufacturers meet new fuel-efficiency standards of at least 35 miles per gallon by 2020, a 40 percent increase over current standards.

General Motors Corp. and Chrysler Group LLC have received billions of dollars in federal loans to restructure their companies through government-led bankruptcies, but Ford avoided seeking emergency aid by mortgaging all of its assets in 2006 to borrow about $25 billion.

General Motors has requested $10.3 billion in loans from the program, while Chrysler has asked for $6 billion in loans. Energy officials have said the loans could go only to “financially viable’’ companies, preventing GM and Chrysler from qualifying for the first round of loans.

Ford has sought a total of $11 billion from the loan program and has previously said it would invest $14 billion in advanced technologies over the next seven years.