The package will be financed by Congress for $900 million, in order to guarantee the $6 billion in loans, and Congress may consider further stimulus packages later this year.
If the entire $25 billion package were to be approved it would cost Congress a total of $3.75 billion - which will provide $25 billion in loan guarantees for auto makers who are retooling plants in order to respond to strict new government CAFE standards and changing consumer demand.
In addition to the $6 billion loan guarantee package, Senate Democrats have also agreed to put up $300 million in funding for research into an advanced battery.
The battery fund is designed to speed up the roll out of more practical and efficient batteries in order to hasten the popularity of the electric car.
While previously the government has been reluctant to participate in bailout schemes for private companies, their current attitude recognizes the difficulties that manufacturers face in attempting to adhere to new fuel efficiency standards and the cost involved in implementing this across an entire product range.
Reader Comments
Thu Jul 31 2008 4:02 AM
bambam says
I here ya,
I guess some of us will now have to go back to work and get
this going the correct way.
Thu Jul 31 2008 5:52 AM
HECTOR says
No, this is not *financed by Congress* and it will not *cost Congress*. This is financed by the American taxpayers and it will cost us.
Thu Jul 31 2008 6:36 AM
craigs says
What a joke, lets keep pumping money into company's that are unable to produce quality products that the market actually wants. The US government is so wasteful in that billions upon billions of dollars are simply thrown away and the tax payers must pay for it.
Thu Jul 31 2008 9:00 AM
Turkle says
Hector, thank you for seeing this travesty for what it is. Congress, the EPA, CAFE, and the laundry list of other organizations attempting to regulate the auto industry into the trash heap have to wake up to reality. How can anyone expect the manufacturers to create new technologies and bring them to market by 2012, 2015, or even 2020 at their current 4-5 year model cycle? The governments of Germany, Japan, France, and even Britian (to an extent) work with their industries (providing research dollars) to meet the new standards set by policy makers. Here in the U.S., Congress has hearings and ignores the industry leaders when they testify that the new emmission and MPG ratings will cost BILLIONS and still provides no garuantee that they will meet these new standards. It takes the continued blood letting at the U.S. Big 3 for these wind-bags to finally understand. I hope that it is not "Too Little-Too Late".
Thu Jul 31 2008 8:55 PM
burke says
$300,000,000.00 in development of a battery? Is this really necessary? Why all of a sudden is a battery so important for the development of a hybrid technology for cars? It looks as though without the new super battery, there can't be the hybrid cars consumers are very much in need...Is it me the only one who knows that for example diesel electric locomotives, which weight about a hundred ton and haul other hundreds of tons average about 300 MILES TO THE GALLON of diesel and do not require a battery? Diesel electric technology for locomotives has been around for about half a century already, and I think it would be a lot simpler and cheaper to adapt such an efficient technology to a lot smaller vehicles like cars and trucks...if this is so, why then still today in US 90% of the freight is still carried by trucks that average 1-5MPG? Are the powers at be really moving in the right direction to solve the so called fuel crisis? Or is it another bluff created by the people who also own the media and the news create a new order in which the rich becomes richer and the poor poorer?
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