Obama Administration Awards First Three Auto Loans for Advanced Technologies to Ford Motor Company, Nissan Motors and Tesla Motors
Washington, DC – Today, the Obama Administration announced $8 billion in conditional loan commitments for the development of innovative, advanced vehicle technologies that will create thousands of green jobs while helping reduce the nation’s dangerous dependence on foreign oil. The loan commitments announced today by the President include $5.9 billion for Ford Motor Company to transform factories across Illinois, Kentucky, Michigan, Missouri, and Ohio to produce 13 more fuel efficient models; $1.6 billion to Nissan North America, Inc. to retool their Smyrna, Tennessee factory to build advanced electric automobiles and to build an advanced battery manufacturing facility; and $465 million to Tesla Motors to manufacture electric drive trains and electric vehicles in California.
These are the first conditional loan commitments reached as part of the Department of Energy’s Advanced Technology Vehicles Manufacturing program. The Department plans to make additional loans under this program over the next several months to large and small auto manufacturers and parts suppliers up and down the production chain.
“We have an historic opportunity to help ensure that the next generation of fuel-efficient cars and trucks are made in America,” said President Obama. “These loans – and the additional support we will provide through the Section 136 program – will create good jobs and help the auto industry to meet and even exceed the tough fuel economy standards we’ve set, while helping us to regain our competitive edge in the world market.”
“By supporting key technologies and sound business plans, we can jumpstart the production of fuel efficient vehicles in America,” Energy Secretary Steven Chu said. “These investments will come back to our country many times over – by creating new jobs, reducing our dependence on oil, and reducing our greenhouse gas emissions.”
These commitments will help reduce the 140 billion gallons of gasoline Americans consume each year, lessening the nation’s dependence on the volatile world market for oil, and decreasing the cause of a fifth of the nation’s carbon emissions. The Obama Administration recently announced an agreement to raise passenger car fuel standards from 27.5 miles per gallon to a target of 35 miles per gallon (mpg) by 2016. While 35 mpg is ambitious, the Department of Energy’s auto loan program received more than a hundred applications for loans to help achieve greater fuel efficiency. The competition among advances in conventional engine technologies, next-generation biofuels, and transportation electrification holds the potential to increase US fuel efficiency dramatically over the next several years.
The Advanced Technology Vehicles Manufacturing Loan Program is an open and competitive process focusing on the best companies and best technologies in American manufacturing. First appropriated in the fall of 2008, the program will provide about $25 billion in loans to companies making cars and components in US factories that increase fuel economy at least 25 percent above 2005 fuel economy levels. The intense technical and financial review process is focused not on choosing a single technology over others, but is aimed at promoting multiple approaches for achieving a fuel efficient economy.
Applications for the loan program have included vehicles running on electricity, biofuels, and advanced combustion engines, and were submitted by both car and component makers, US automakers, US manufacturing subsidiaries of non-US-based companies, major US auto parts suppliers, and innovative startups.
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