Promises are one thing – delivering is another. Some of the biggest car manufacturers in America are pushing for guarantees about federally backed loans when Congress returns in September.
Detroit’s ‘big three’ want around $50 billion in loans to help develop and build more fuel efficient cars. However, the future of these loans is currently uncertain, as neither the White House nor Senator John McCain has expressed support for the measure. Only Senator Barack Obama has gone on record to state that he supports the idea of loan guarantees.
It was in December last year that Congress passed a bill that authorised $25 billion in loan guarantees to retool older plants over five years. However, lawmakers have yet to approve the money to fund the program. According to Green Car Congress, car manufacturers will now seek this loan to be doubled.
The money is seen as necessary if America’s car manufacturers are to keep pace with overseas rivals in the development of green cars. Up until the last 12 months, demand for fuel-efficient vehicles in the USA had remained low – but with gas prices soaring to around $4 a gallon earlier this year, the need to ‘go green’ has hit home among consumers and businesses alike.
What do you think of the loan proposals? Do you think the Government should bail the car manufacturers out? Are the loans a must for the companies to survive? Leave a comment with your thoughts.
