The Obama administration on Tuesday announced Ford, Nissan, and Tesla have been approved to receive loans under the Department of Energy’s Advanced Technology Vehicles Manufacturing program. The news is particularly important for Tesla, because the loan will enable the startup to begin construction of an assembly plant for its Model S electric sedan and it also marks the first time Ford has taken federal funding, albeit not under the same circumstances as the Chrysler and GM bailouts.
Tesla was awarded $465 million in loans, which is actually more than the $300 million it claims to need. Meanwhile, Ford will receive $5.9 billion to retool factories in five states to produce 13 high-efficiency models, including electric cars. Nissan will get $1.6 billion to build a new U.S. battery plant and overhaul its Smyrna, Tennessee, plant to build electric vehicles.
The loan program, funded by Congress in 2008, totals $25 billion. There are a number of other applicants — mostly battery makers and related suppliers — also vying for slices of the pie. Tuesday’s announcement represents the first allocation of funds from the program.
“We have an historic opportunity to help ensure that the next generation of fuel-efficient cars and trucks are made in America,” President Barack Obama said in a statement.
“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.”
Energy Secretary Steven Chu said the loan program is important to help “jumpstart the production of fuel efficient vehicles in America.” He went on to say the 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.”
Ford’s share
Ford says it will use the $5.9 billion in funding to help upgrade more than a dozen of its models, including the Focus, Escape, Taurus and F-150, though it hasn’t said in what ways it will modify existing models or create future efficiency-oriented variants. Though the loans do not help ensure Ford’s survival, they are significant as this is the first time Ford has accepted such substantial federal funding.
“This really gives us a gift of hope,” Michigan Governor Jennifer Granholm told the Detroit Free Press.
The loans will help Ford convert nearly 35,000 positions into so-called “green jobs.” Nissan says its loan will eventually result in 1,300 new positions at the Smyrna facility, while Tesla indicates 1,000 new jobs will be created with the Model S facility, which is intended to build 20,000 vehicles per year by 2013.
06/23, 12:40 PM
posted by:
RaineMan
I don’t understand why the US is giving money to foreign-owned car companies. I didn’t see Japan tossing GM any money when they needed it.
06/23, 12:44 PM
posted by:
mentir
So this is what Musk meant when he said Tesla would be profitable next month, although I don’t think “profit” means what he thinks it means.
06/23, 12:58 PM
posted by:
winnipegjets
the government is giving nissan the money because the money is staying in america and giving americans jobs.
06/23, 1:05 PM
posted by:
Bankruptcy2009
Raineman agreed, but don’t forget Ford or Chrysler don’t just ask Japan to Give GM money be fair about it. Ford and Chrysler deserve apart of whatever Loan pie Japan could offer as well.
GM has been nothing but a cash drain throwing good money after bad. I say almost good riddance. I mean the joke is everyone and his brother already knows Japan Subsidizes its Industry and the only time the US Gov will do anything is when companies are forced into bankruptcy. I am happy for Ford and Tesla that they got their loans. However Tesla is busying exporting their ideas to Mercedes Benz. Meanwhile. And I am upset that Nissan is getting a load. Why? they are a foreign company even though they have factories here.
I mean Ford Motor should be able to get a loan from Japan its Only Fair.
06/23, 1:16 PM
posted by:
bigs4610
(shakes head)
un****ing believable
06/23, 1:35 PM
posted by:
sj79
Nissan should get money from Japan. Why would the US government loan money to a Japanese company to help it get a foothold in electric cars that will end up competing with US based automakers. How stupid can you get?
06/23, 1:51 PM
posted by:
SNOT
Look’s like a way for Mr. Obama to stick his finger in the Japanese car market.
06/23, 1:52 PM
posted by:
CADDY-V
niASSan?? What??? Don’t give them a dime? Japan has had no problem giving their car companies billions over the years let them get money from their own government.
06/23, 1:55 PM
posted by:
Scarface03
Nissan isn’t getting a bailout or any other kind or preferential treatment. The money is a loan, the U.S. Gov’t will charge interest, and Nissan will have to pay it back. **I** would loan money to Nissan, and any other fiscally sound company, capable of repaying the $ with interest. Nissan will use the money to employ and benefit American workers. Sure, you could argue that by building and renovating U.S. plants, ultimately the money will benefit a foreign corporation. But in a free market society, I don’t think sacrificing American jobs for the sake of less competition for American companies is an even trade at all.
06/23, 2:04 PM
posted by:
Bankruptcy2009
I know really sj79 how dumb can you get. The Taxpayer is paying for Nissan to be better and our Government can give out more money we don’t have to not only competitors but more to our ailing auto industry that can’t compete. Anyone else see the Stupidity and the Conundrum the US Government has put the tax payer in. But Heck you voted for wealthy Democats to go to Washington to represent you! and this is how they repay you and all the while Driving Foreign made automobiles!
SHeer Stupidity on the Democrat Voters part. Oh well when you have no job. and wonder why. Re Read this!
06/23, 2:15 PM
posted by:
mayer_ray_nagin
Loans per se do not bother me much, but if the A-holes in DC try to use this as leverage over these companies or firing their CEO’s and all that crap, then these companies will also go on that list of product manufacturers I will boycott explicitly.
That means I am specifically watching what that narcissistic buttwipe Obama and his crapstain auto task force do to Ford. Interfere and I simply don’t buy a domestic brand I really don’t care about Tesla or Nissan too much anyway because they build trash.
06/23, 2:41 PM
posted by:
leftwingagenda
oh no, mayer put obama on notice! you read it here first…
i was a little surprised to see nissan and tesla on that list, and surprised ford is accepting loans from the government, given the stigma that has these days…
personally, i try to look past the knee jerk reaction of “nissan? they’re japanese! get the pitchforks!” because in a global economy you just can’t think that way anymore…take a company like dell…american company, based in texas, but with a large outsourcing of labor to india…lets say the government of india loaned dell some money to keep those jobs in india…overall, it’s a win for india (they keep the jobs) and it’s a win for dell (they get a favorable loan)…
it’s the same thing with these loans, it just happens to be a foreign company on our soil instead of the reverse…the concept is exactly the same, though…
06/23, 2:51 PM
posted by:
athens
Why is Nissan getting an electric car program loan?
Truly many of you must jest.
This is a result of Nissan having firm contracts with Phoenix, Tuscon, San Francisco, Albuquerque,San Jose, Portland, Marin County CA, Nashville and at least another dozen municipal government agencies and the respective electric utility companies to provide all plug-in electric government vehicle fleets by 2011.
Instead you should be asking how Nissan has landed all these contracts as well as deals to provide similar systems with Renault in Israel, Denmark, and Portugal. Could it be because they have the only viable and affordable offerings in development thanks to $1 billion of Nissan (Japan’s) own investment capital? $250,000,000 of that money is to develop their own battery manufacturing plants with NEC.
Yeah the Japanese will benefit, because they took the huge risk with their own investment money and came up with the better plan. Ought they not get a return on their investment?
The first to truly benefit will be American taxpayers who pay for the government fleet systems.
I don’t see any American auto plant workers being laid off with this loan. Instead Nissan will be adding plant capacity and building a new plant hiring American workers.
06/23, 3:12 PM
posted by:
Borat
I thought green as a color of money
06/23, 3:52 PM
posted by:
smfic
this is an $hitload of money even by car company standards. wanna bet in a few months/year we hear from ole’ Barney Frank “Well, we gave you, Ford, US Taxpayer money, so Congress now has a vested interest in your company. You need to do X, Y, and Z in order to level the playing field with GM and Chrysler”?
06/23, 3:57 PM
posted by:
mayer_ray_nagin
LWA, learn to read. I put Ford on notice. In case you haven’t paid attention they are the current beneficiary of a helluva lot of goodwill primarily because they are not owned and operated by your idiot POSident’s task force. So in effect I reflect what a lot of people are saying.
Despte what you think a lot of people believe like I do. Don’t beleive me? Approval of your blowhard prez’s handling of GM is around 30%. he may be a likable enough person, but his policies suck and that is catching up. I wont piss money away on paying off Oblowhard’s political favors – at least not more than the dipsh!t steals in taxes.
Oh yes, by the way LWA – seen that capital flows stats lately? Turning negative on the USA because nobody wants to invest in a place where the government steals your investment later to pay off friends like Obama did. I’m doing my share also by taking my investments out of country in different ways. laugh all you want at the fact that I am not George Soros, but there is a lot of money in us medium and small investors and we are not leaving it here for your dictator to steal ala Hugo Chavez. The reason why Obolshevik is being less intrusive now is because he wasnt aware of how fast money can flow out of here but when he found out he learned how to STFU fast.
06/23, 3:57 PM
posted by:
Bankruptcy2009
Left Wing and Athen both of you think with a brain that if it were an elevator NEVER reaches the TOP FLOOR.
Fist Athen you put your foot in your mouth sir. You said what I just said. THe Japanese subsidizes their auto industry unfairly. So they don’t have to worry about any loan. You just Admitted it. Caught the Stupid Crook who approves of this BS.
What happens is sure they gave them all that money. But our Government does not. NOW ADD TO THAT already unfair advantage NOW NISSAN IS OUT WITH ITS HANDS AGAIN IN THE US, because after all they got all that Reasearch Capital the Japanese government gave them. And the Politicans in this country believe the US public is deaf, dumb, blind, and stupid. And for the most part there RIGHT!. SO theygo ahead and Give Nissan MORE MORE FOR ELectric vehicle development.
Left wing Shut up. Ford has recieve Nothing up until NOW. This is a Loan has to be repayed. Dumb ass.
06/23, 7:15 PM
posted by:
SomeGreek
Bankrupt, does ford have any factories in Japan? Or why the fvck should japan give a dime to them?
06/24, 10:39 AM
posted by:
Moke1310
I am interested by the photo – I assume an error but is the first undisguised shot of the new Jaguar XJ we have seen?
06/24, 10:44 AM
posted by:
mayer_ray_nagin
Moke – more likely the tesla sedan
06/24, 11:37 AM
posted by:
wbent
Unfortunately for Ford the application was submitted along with ‘Old GM & Chrysler” well before any of the mess, my fear is the pin head talking heads will portray this as a quasi bailout and I am sure Ford will be the headline with very little focus on Nissan and Tesla. The only upside is if Mulally hits the talk show circut and really lays out what Ford will do with the money, if he does that I beleive he will gain support and consumer confidence. My fear as stated above is jack offs like Barney the *** uses this as leverage. So if there is 25b and now 7b will the bulk of the balance go to the “New GM & Chrysler”?
06/24, 3:05 PM
posted by:
Rafa LL
Good for Tesla and Nissan!
06/24, 3:05 PM
posted by:
Rafa LL
Ford should quit.
06/24, 9:58 PM
posted by:
Salma01
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