Detroit — Energy Secretary Steven Chu told reporters today on the sidelines of the North American International Auto Show that he had met with Chrysler CEO Sergio Marchionne about a government loan to allow the company to retool older plants. He denied that political pressure from Republicans in opposition to awarding Chrysler an estimated $3 billion loan from the $25 billion Advanced Technology Vehicle Manufacturing Program was a factor.
“We’re very serious,” Chu said. “We’re looking at the loan on its merits. We’re talking to Chrysler and there are pressures for and against but in the end we have to look at what the (law) says and what we think would be good for America’s workers, what would be good for the American car industry.”
Chrysler applied for a loan in late 2008 — and ultimately won a $12.5 billion bailout from the Bush and Obama administrations. The company has been in talks over a $3 billion loan from the Energy Department for 18 months. “We’re continuing to work with him,” Chu said.
But even without loans from the program, Chrysler is doing well, Chu said. “Chrysler — with the others — has bounced back remarkably well,” Chu said.
Last week, the Energy Department scuttled a $730 million retooling loan to Russian steelmaker Severstal OAO’s Dearborn unit that it had tentatively approved in July. The program has awarded a $5.9 billion loan to Ford Motor Co., $1.4 billion to Nissan Motor Co. to build the electric vehicle in Leaf, and about $500 million each to California startups Tesla Motors and Fisker Automotive Inc.
Many companies have abandoned their loan requests — including GM, which had sought up to $14.4 billion but dropped its request in January. 2011. Some companies have collapsed while waiting for a decision from the Energy Department on whether to grant them loans.
Marchionne showed Chu the new Dodge Dart. Chu sat behind the steering wheel of the Dart. “I think we are beginning to understand the limits of combustion. There’s much more that combustion can give you before you throw it out,” Marchionne told Chu. “I feel better about what we can do by 2015 than I have ever felt.”
Chu joked with Marchionne — referencing the fact that Chrysler is making money. “He can even afford new sweaters,” Chu said. Sen. Debbie Stabenow, D-Lansing, said: “It does look new.” Marchionne retorted: “It’s amazing what you can do with recycling. It’s part of our energy conversation.”