U.S. government lends $8B for 'green' vehicles
Last Updated: Tuesday, June 23, 2009 | 6:21 PM ET
CBC News
The prototype Tesla Model S on a test drive in March.
(Reed Saxon/Associated Press)The U.S. government is lending $8 billion US to companies that are working on green vehicles, including electric cars, President Barack Obama said Tuesday.
The conditional loans represent “an historic opportunity to help ensure that the next generation of fuel-efficient cars and trucks are made in America,” he said.
The government hopes the loans will create jobs and reduce U.S. reliance on imported oil.
The recipients include:
- Ford Motor Co., which will get $5.9 billion to update factories in five states to make 13 more fuel-efficient models, including the Focus, Escape, Taurus and F-150 pickup.
- Nissan North America, which will get $1.6 billion to retool a Tennessee plant to make electric cars and to build a battery factory.
- Tesla Motors, which will get $465 million to make electric-drive trains and vehicles in California.
"These investments will come back to our country many times over," Energy Secretary Steven Chu said.
Electric car to benefit
Tesla, a privately owned company, will use most of the loan to finance a plant for its Model S sedan, introduced in March.
The car runs entirely on electricity from any conventional 120-volt or 220V outlet, and will get the equivalent of more than 250 miles per gallon (106 kilometres per litre), the government said.
The Model S has an anticipated base price of $49,900 US (including a $7,500 federal tax credit) but the company said the lifetime ownership costs are comparable to a conventional car costing $35,000 because electricity is cheaper than gasoline and the car requires less maintenance.
Production is slated to begin in 2011 and as many as 20,000 cars could be produced by the end of 2013.
More than 100 companies applied for loans under the Department of Energy’s Advanced Technology Vehicles Manufacturing program to raise fuel efficiency.
The program has $25 billion in loans to allocate to companies making cars and components in U.S. factories that increase fuel economy at least 25 per cent above 2005 levels.
