House approves $25 billion in auto industry loans

[DainBramaged]

Automakers and suppliers soon should be able to seek $25 billion in low-interest federal loans to retool plants to build fuel-efficient vehicles and components.

The House of Representatives today voted 370 to 58 to approve a broad spending bill that includes $7.5 billion to start the loan program.

The Senate is expected to agree to the budget bill this week, and President Bush is expected to sign it. The bill's main purpose is to keep government running in the new fiscal year that begins Oct. 1.


The loan program represents unprecedented government involvement in auto industry operations -- far exceeding loan guarantees for Chrysler Corp. in 1979 and continuing federal support of vehicle technology research.

An energy law enacted last December authorized but did not fund the $25 billion loan program. The law also mandates sharply higher fuel economy standards in the 2011-20 model years.

Plunging new-vehicle sales and dramatically higher borrowing costs have compelled industry leaders, particularly from the Detroit 3, to make funding of the loan program a priority. Industry lobbyists got the funding attached to a bill that lawmakers had to take up before they go home for the November elections.

The final version of the bill is expected to include language that would speed the issuance of the loans and the adoption of rules by the Department of Energy that would govern their use, said John Bozzella, Chrysler LLC's vice president of global external affairs and public policy.

Industry lobbyists apparently failed to loosen other restrictions on the use of the loans, such as a requirement that the money can be spent only on retooling that leads to vehicles that are 25 percent more fuel-efficient than similar models.

Rep. John Dingell, D-Mich., chairman of the House Energy and Commerce Committee, said in a statement:

"Some critics will call this loan package a bailout. It is not. These loans amount to a little more than 1 percent of the real bailout -- the one that the Bush administration wants for Wall Street at a cost of $700 billion to taxpayers.

"The loans to the automakers will cost about $7 billion and will be repaid to the taxpayer at a profit," Dingell said. "The auto direct-loan package is a good deal for auto workers and a good deal for taxpayers."

Rep. Jerry Lewis of California, ranking Republican on the House Appropriations Committee, complained that the broad spending bill was put together by a handful of Democratic leaders. He said most lawmakers voted on the bill without knowing its contents
http://www.autonews.com/apps/pbcs.dll/article?AID=/20080924/ANA02/809249974/1128 (subscription only, posted in full)

Japan funded the Prius, why shouldn't we fund the next generation of fuel efficient cars?

[DainBramaged]

1. This means nothing, let's talk about Sarah Plain's glasses instead!

:eyes:

[jakefrep]

4. The "fuck-em, let 'em die" crowd, is too busy bitching about the big "bail-out:" to notice

But I agree with this. If our goverment had taken a more enlightened, proactive approach to alternative vehicles earlier, it might not have cost them $7.5 billion now.

[Supersedeas]

35. the advertisers control the chattering class -- see any Auto commercials lately?

[Romulox]

2. DU's Blue Dogs/"Free Marketeers" approve of bailing out of Wall Street, but are against this.

[DainBramaged]

9. Isn't that just stupid, they were SPECIFIC about the use of the loan

and it benefits US not the auto companies, AND it is to be paid back with interest.

[Fumesucker]

3. A Geo Metro from the early nineties will get forty mpg..

I had one with the 1.3 DOHC four cylinder and a five speed, I couldn't get it under 30 mpg no matter how hard I drove it. The little pocket rocket would spin the front tires just from mashing on the loud pedal in first gear, you didn't have to drop the clutch and it would touch 115 mph in fourth gear.

Building a car that gets good mileage isn't rocket surgery, the basics have been known for decades.

[Romulox]

5. It's basic physics. You'll have to give up the cd-changer, ABS, side curtain airbags, etc.

if you want to match a Geo's MPG with that decades old technology to which you refer.

More weight = less mpg.

[Fumesucker]

7. None of the things you mention weighs all that much..

Cars today basically weigh more because they are bigger. Right offhand I can't think of a single car model that has ever gotten smaller as it was redesigned over the years.

I carried an air compressor with a 60 gallon tank in my Metro, just flipped the back seats down, dumped it in there and closed the hatchback. There are a lot of cars considerably larger where that would have been impossible to do.

Oh, and I had a CD changer, a 400 watt amp, a 200 watt amp and a 12" sub in my Metro.

Edited to add: And in my experience weight makes a difference in stop and go driving but doesn't effect highway cruise mpg much at all. My Expedition tow vehicle with a 5.4 gets about 21 mpg on the highway when not towing and about 16 mpg with a dual axle trailer with another SUV on it behind, I'm sure that the majority of the efficiency drop is due to the increased aerodynamic drag, the bare trailer weighs nearly two thousand pounds and only drops the mpg to about 19.5 or so.

[Romulox]

8. You forgot more stringent crash standards. (And ABS, 4 wheel disc, side curtains DO weigh a lot.)

The bottom line is that there is no alchemy involved. Lighter cars = less amenities and safety features = more mpgs.

[Fumesucker]

12. My Metro had 4 wheel discs.. Oversized ones actually.. Very powerful brakes..

ABS doesn't weigh more than 25 lbs or so at the outside, side curtains really don't weigh all that much, it's an empty balloon with a little bit of sodium azide and potassium nitrate.

And designing a car for higher survivability in a crash means designing it to crumple in a controlled manner, cars that are too strong, like pickup trucks are actually more dangerous because they subject the passengers to higher G forces in a crash.

The strongest predictor of vehicle weight is the size of the vehicle, bigger cars weigh more. Until exotic materials such as carbon fiber start coming into common use, that will remain true.

A 2008 Z06 Corvette has 505 horsepower and can get over 30 mpg on the interstate at 70 mph cruise.

[Romulox]

14. So the million dollar question remains: why don't YOU drive a Geo Metro/Suzuki Swift? Today.

:shrug: :hi:

[Fumesucker]

16. Go and try to buy one...

The price of Metros and Swifts has jumped radically in the last year or two..

I needed a vehicle that can tow heavy loads and I only really need one four wheeler.

My motorcycle gets about 60 mpg and hauls major ass and my recumbent bicycle gets infinite gas mileage.

[Romulox]

18. Suzuki out of business? No? Any speculation on why they don't sell the Swift/Metro here?

(We will take it as read that GM doesn't sell the Metro any more due to collusion with Big Oil. :silly: )

But my curiosity, is, How is GM preventing the Suzuki Swift from being an ongoing hit in America, seeing as it is technologically superior??? Any insight?

PS: LOL on saying this after talking up the GEO: "I needed a vehicle that can tow heavy loads..." :rofl:

[Fumesucker]

21. I need a vehicle that can tow for *business* purposes..

The point about the Geo/Swift is that high mileage is not that difficult to do even with technology that's nearly two decades old now.

Even a BWM 325e from the early 80's can get well over 30 mpg with a 2.7 six cylinder.

[Romulox]

24. You're avoiding the question: WHY ISN'T IT ON SALE RIGHT HERE, RIGHT NOW?

The SX4 you are talking up is a joke compared to the Swift/Metro. By no means is it any better than what GM is doing in cars of this size.

[Fumesucker]

27. My guess is that Suzuki doesn't think Americans will buy enough very small cars

To make redesigning the Swift for the American market worth the effort.

Even now I see few very small cars being driven by Americans, we by and large like monster sized cars and trucks.

And you are avoiding my point, that building a car that can get very good mileage is not something that needs a great deal of money spent on developing new technology.

[wvbygod]

32. Can't carry firewood in it and many other shortcomings

It won't make it to the back 40 to get the work done that needs done.

I could go on.

[DainBramaged]

10. WOW can you bulid me one Mr. Wizard?

The new Cobalt replacement will get over 40MPG without hybrid technology. So will you be buying one of those?

[Romulox]

13. More importantly, why doesn't Suzuki offer the Swift (Metro) in the US market if it is so great???

Hmmmm.... :shrug:

[Fumesucker]

17. A friend of mine just bought a new Suzuki SX4

Very nice little car and it gets excellent mileage..

Not quite as good mileage as a Metro or Swift but it's somewhat larger.

[Romulox]

19. SX4 only gets 22/30 mpg! He should've bought a Metro/Swift. It's the best. nt

[Fumesucker]

22. Actually the EPA mileage ratings are quite conservative..

He gets 31 mpg at about 80 mph..

[Romulox]

23. That's still terrible as compared to the Metro/Swift. Shame on Suzuki! nt

[Fumesucker]

29. Actually no...

My Metro got about 33 mpg at 80 mph..

[DainBramaged]

31. Won't pass current safety standards (they are tin cans).

[Fumesucker]

33. They don't have safety standards in Europe?

I did not know that..

/Johnny Carson

[DainBramaged]

34. (sigh) European standards are NOT as stringent as US standards

and if that was the case, every piece of shit from manufacturers like Tata would be here too.

Does thinking that there MUST be a reason other than demand cross your train of thought, or are the gates down?

[Fumesucker]

15. I never buy new cars..

Maybe when the Cobalt replacement gets to about ten years old or so I'll buy one.

I haven't had a car newer than eight years old in at least a couple of decades.

[DainBramaged]

30. Me either, my 'new' car is 14 years old, 29 MPG combined

and it's a 'Murican car, not no rice.

[wuushew]

6. Where is the actual text of this bill?

:shrug:

I think I shall like to read it myself.

[DainBramaged]

11. There is this thing called Google.............

[MadrasT]

20. I like it.

Thanks for the "under the radar" news.

[HeraldSquare212]

25. God, to think I was apoplectic about this just a week ago. I miss those days.

[Romulox]

26. Bet you claim bailing out Wall Street is with $1 T is "necessary" though, don't you.

Of course you do! :hi:

[HeraldSquare212]

28. You just lost that bet.

[wuushew]

36. kick

:kick: