Automakers want flexibility on loan program
The head of General Motors urged lawmakers Friday to loosen eligibility requirements for billions in loans intended to help automakers meet new fuel efficiency standards.
To get the money, automakers have to produce cars and trucks at a retrofitted plant that are 25 percent more fuel efficient than similar models manufactured elsewhere. The loan program was authorized to help car companies meet the 35 miles per gallon fuel efficiency by 2020 standard Congress adopted in 2007.
{mosads}“The specific terms included last year are not comprehensive enough from our perspective,” said Rick Wagoner , CEO and chairman of GM, said during an “energy summit” sponsored by the Senate Energy and Natural Resources Committee. “We’d like some amplification of those terms.”
Pressed by committee Chairman Jeff Bingaman (D-N.M.) to explain what he meant, Wagoner said Congress should loosen the terms for the loans, granting eligibility to “projects consistent with the commitments with fuel economy.”
Wagoner said not all GM hybrid programs would be eligible for the loans even though they would improve fuel economy standards.
Automakers are lobbying lawmakers to appropriate $3.75 billion to start the loan program before leaving again on recess. Industry executives and lobbyists have been contemplating trying to expand the loan program to $50 billion. But one auto lobbyist said the industry backed away from that goal after meeting with resistance on Capitol Hill.
Sen. Bill Nelson (D-Fla.) said he was worried automakers would be back asking for more money.
“Because of your financial condition, that’s not going to be enough,” Nelson said, referring, apparently, to the $25 billion loan program. “And you all are going to come to us with some kind of … package to rescue you.”
Nelson said he voted for the loan program that propped up Chrysler in the late 1970s.
Nelson said it would be “hard” to provide the industry additional help “when each year that I have been in the Senate, you all, collectively Detroit, opposed us and beat us every year when we had tried to increase miles per gallon standards.
“Why we should come to the financial rescue?”
Wagoner said the auto industry unanimously supported the fuel efficiency increase in the energy act passed in 2006.
“We’re not here today … asking for any bailouts,” Wagoner said.
Environmental groups, meanwhile, reacted warily to Wagoner’s push to loosen the restrictions on the loan program.
“The public ought to benefit if it is going to help automakers retool their plants,” said Eli Hopson, Washington representative for the Union of Concerned Scientists.
“It’s hard to believe they couldn’t get 25 percent.”
Copyright 2024 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed..