Automotive News reports that Chrysler Group LLC has tired of waiting for the U.S. government to make a decision regarding the automaker’s candidacy for as much as $7 billion in green auto loans. The potential loans from the U.S. Department of Energy are intended to encourage automakers nationwide to adopt more environmentally friendly production methods and produce automobiles and trucks that are more fuel efficient.
On the outside looking in
Chrysler CFO Richard Palmer reportedly filed a one-sentence notice with the U.S. Securities and Exchange Commission Thursday. The brief note made the automaker’s decision to withdraw its request for green auto loans official.
The loan money Chrysler had sought would have come from a pool of $25 billion earmarked for distribution under the Advanced Technology Vehicles Manufacturing loan program. Chrysler applied for green auto loans under the program shortly after the program was given the green light of Congressional approval back in 2007.
Advanced Technology Vehicles Manufacturing funds are intended to repay automakers for money spent upgrading and retrofitting old production plants with the technology necessary to produce vehicles that adhere to more stringent fuel efficiency standards. Despite giving up the search for such government funds, Chrysler noted via a written statement to the automotive media that it will not be hindered in its course to achieve previously stated business goals.
Marchionne frustrated at lack of response
Over the past two weeks, Chrysler-Fiat CEO Sergio Marchionne has expressed frustration over the length of time the U.S. Department of Energy has taken to consider the automaker’s green auto loans application. Even after cutting its initial request down from $7 billion to less than $3.5 billion, Chrysler did not gain traction in the approval process.
Marchionne exclaimed that the lack of Advanced Technology Vehicles Manufacturing loans “will put (Chrysler-Fiat) in a very, very uncompetitive position against the other two [automakers] in Detroit.”
Elaborating on the financial status of rivals Ford Motor Co. and General Motors, Marchionne did not mince words.
“One blocked Department of Energy funding and the other one was using equity capital, which is probably even a better substitute than Department of Energy funding at a lower rate,” he said. “So I’m the only guy who is sitting over here that pays back everything with interest and I am sitting over there and I don’t want to be favored, I just don’t want to be mistreated.”