Ford seeks loan guarantees for green tech
Ford Motor Co. will keep investing in new fuel-saving technology even if it doesn’t get any government loan guarantees, but the loans will help the automaker get the technology to market more quickly, Executive Chairman Bill Ford said Friday.
Congress reconvenes next week, and the auto industry plans an aggressive campaign to get lawmakers to guarantee up to $50 billion in low-interest loans. Auto executives say the money would help modernize assembly plants and develop next-generation vehicles.
Ford, in an interview at an event marking the upcoming 100th anniversary of the Model T, said the loans are important to help the industry deal with higher fuel economy standards, carbon dioxide emissions limits and a marketplace that has shifted from trucks to more fuel-efficient cars.
"I think it’s important to our whole industry, all the retooling we’re doing as an industry, to really meet the future demands of fuel economy and CO2 and all the new technology that’s really going to be needed to achieve that," Ford said.
The company that bears his family’s name, he said, will go on without the loan guarantees, but its work will be tougher.
"We’re fine, but this certainly would help," he said after signing hats, books and business cards for many of the more than 100 Model T owners who had gathered outside the company’s world headquarters. "It would just make everything more difficult, and we may have to go slower, and that’s clearly not what society wants."
Ford said the company doesn’t have a number in mind for how much it would borrow. But he said the government-backed loans, which Ford (F, Fortune 500) intends to repay, would mean the difference between single-digit interest rates and the double-digit rates now available in a tight credit market. That potentially could save the troubled automaker millions of dollars.
Ford has lost $23.9 billion in the past 2 1/2 years and has had to mortgage its assets to stay in business as the U.S bad credit payday loans. auto market has shifted away from profitable trucks and sport utility vehicles to more fuel-efficient models.
Mark Fields, Ford’s president of the Americas, said the loan guarantees are good for the country because they would help preserve an industry that is responsible for one in 12 U.S. jobs. They’re not a bailout, he said.
"This is not about benefiting Wall Street, like maybe some of the other actions that have been taken," Fields said. "This is benefiting Main Street, the working men and women. The auto industry is part of the backbone of the U.S. economy."
The federal government estimates that fuel efficiency and other requirements in the energy bill passed earlier this year will cost the auto industry around $100 billion, but Ford’s estimate is higher, Fields said.
He said the loan guarantees should be open to all manufacturers, whether foreign-based or domestic.
Bill Ford said the loans are important if the U.S. wants to have a strong industrial base, as other governments have financially backed their manufacturers. He also said the government should help decide what fuel-efficient technology U.S. automakers should embrace, so they can focus their capital investments.
Ford wouldn’t predict the chance of the loan guarantees getting through Congress.
"I’m very happy that both presidential candidates have endorsed this," he said. "The leaders of both parties are embracing this as something that they believe in, so that’s got to help us."