The U.S. Treasury Department announced on Friday that it has granted Chrysler Financial a $1.5 billion loan. The $1.5 billion is in addition to the $4 billion Chrysler LLC has already received, and will be used to extend financing to Chrysler buyers.
Chrysler was seeking an additional $3 billion in loans, but the Michigan automaker will have to make due on half that amount — at least for the time being. As with GMAC’s $6 billion government aid package, Chrysler Financial’s chunk will be carved out of the $700 billion TARP fund.
The Treasury Department described the loan as “part of a broader program to assist the domestic automotive industry in becoming financially viable”, according to Automotive News. The loan is for five years with a flexible interest rate.
However, it remains possible that Chrysler could still receive the full $3 billion it was looking for. A much farther-reaching loan program is expected to be launched by the Federal Reserve in the coming weeks.
