Auto Makers to seek low cost loans from government
The leading automobile makers General Motors Corporation, Ford Motor Company and Chrysler LLC are considering a proposal to seek about $50 million in low cost loans from the federal government to help them modernize their assembly plants and develop next-generation fuel-efficient vehicles.
The top executives at these companies, each incurring significant losses as industry sales decline, are expected to meet the government officials in Washington in this regard, the industry sources said. They will also meet the Congressional leaders and the Federal Reserve officials, it is said. Meanwhile, it is learnt that the three companies are preparing plans to act as one entity to get low-cost funding.
The auto makers and some part suppliers are seeking low-interest loans to manufacture fuel-efficient cars as the high gasoline prices have increased the demand for fuel-efficient cars. Meanwhile, many automobile companies have been hit by the fall in the demand for trucks and SUVs as the fuel price inched towards $4 per gallon. They are hopeful of getting these loans, the industry sources said. It may be mentioned here that both Republican and Democrat presidential candidates recently supported providing more capital to automobile makers for the research and development of fuel-efficient cars.