The Energy Department will be making loans for the first time in three years with the goal of spurring even more development of fuel-saving technologies.
Peter W. Davidson, the head of the Energy Department's $25 billion program to give loans for technologies that save fuel, told The Detroit News that the coffers will open up for the first time since 2011.
While he didn't name the companies that will receive these loans, Davidson said that most of the loans will be focused on suppliers, especially those who are working to make vehicles lighter.
Cutting weight is a good way to improve fuel economy, which in turn helps automakers comply with Corporate Average Fuel Economy standards.
With Ford using aluminum extensively in its 2015 F-150 and Jeep ruminating about a possible aluminum body for the Wrangler SUV, it's not hard to see that more suppliers might be looking for loans to retool plants to work with aluminum.
The Advanced Technology Vehicle Manufacturing Program was created by Congress in 2007, and it has given out $8.4 billion in loans, leaving $16 million on the table. No loans have been awarded since March 2011. Additionally, two out of the five companies receiving loans went out of business.
One was Michigan-based VPG, which built handicap-accessible vans for disabled customers (some VPG vehicles are used in Chicago as taxi cabs for non-disabled and disabled people alike). The other was startup automaker Fisker, which received $529 million in loans before imploding.
Other loans have fared better. Ford and Nissan have done well with their loans, and Tesla repaid the government back nine years early.
With more of these loans going to suppliers, it will interesting to see how the funding will go toward lighter vehicles and other methods that improve fuel economy.
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