Japanese automaker Nissan is seeking a share of the U.S. Energy Department’s $25 billion loan program for advanced energy-efficient vehicles. Lawmakers created the fund nearly a year ago, but so far no loans have been issued. Other automakers that have applied for the loans include Ford , which is asking for $5 billion, and Tesla , which seeks $400 million.
Nissan has not disclosed the amount of its loan request, but indicated it would use the money for electric vehicles. General Motors and Chrysler have asked for around $8.5 billion in financing apiece. This amount is not related to the $17.4 billion the two companies received as part of the TARP bailout in December. Honda and Toyota are not seeking any loans, according to Reuters.
Nissan said it would use the money to upgrade its Smyrna, Tennessee, assembly plant and build a new facility for battery production. Of course, there are still questions over whether a non-U.S. automaker should receive loans from the U.S. government. Although all of the immediate investment would be made on U.S. soil, a foreign automaker’s overseas operations could easily benefit from the research and development done in America.
“We are committed to the vision of energy independence, environmental sustainability, and the new energy economy, and we are hopeful that the U.S. Department of Energy approves this loan request,” the company said in a statement.
As of January 23rd, the Department of Energy had received 75 applications for the loans — 26 of which passed the technical feasibility study, including the Detroit Three and Tesla .
The next major hurdle for all companies involved is demonstrating their ability to repay the loans in a timely manner. That could be a big stumbling block for Chrysler and General Motors. Ford will likely fare a little better, and Nissan seems to be the most eligible candidate in this regard. For its 1.6 percent share of the money, Tesla is aiming to show profitability by summer. The California-based startup says it would use the money to quickly build an assembly plant for its Model S sedan, which is already in the prototype stage.
