Energy Department revives auto loan program despite Fisker flop – Fox News
The Obama administration announced this week it is reopening a loan program for advanced fuel-efficient vehicles that was derided by Republican lawmakers last year after two of the first five loan beneficiaries halted operations.
The Department of Energy said Wednesday it is reviving the Advanced Technology Vehicles Manufacturing Loan Program and is reaching out to manufacturers of auto parts and components to apply for more than $16 billion in available funding, The Wall Street Journal reported.
Energy Secretary Ernest Moniz said the program, which has has provided $8.4 billion in funding since 2009, will have a revised application process to speed up reviews and address concerns from auto makers about the process being too complex.
“Today we are presented with an opportunity to hit the accelerator on U.S. auto manufacturing growth,” Moniz said at a conference in Washington. “Motor vehicle parts manufacturers play a significant role in the development and deployment of new technologies to meet the demand for fuel-efficient vehicles.”
The program came under scrutiny after the department lost $139 million on a loan to electric car maker Fisker Automotive Inc., which filed for bankruptcy in 2013. Fisker received $192 million from the program before funding was pulled.
In September 2013, the Energy Department lost about $42 million on a loan to a shuttered Michigan company that made vans for the disabled. Vehicle Production Group, or VPG, suspended operations the same year after receiving $50 million in financing.
The loan program did have success with electric car maker Tesla Motors Inc., which repaid its $452 million loan in 2013, according to the report.
House Oversight and Government Reform Chairman Darrell Issa, R-Calif., who said at hearing last year that the program never should have considered Fisker, told the Wall Street Journal he questioned administration’s plan to revamp the program.
“Despite the Energy Department’s appalling track record of loan programs, which put taxpayer money on the line to fund junk-bond-rated companies, this administration will do anything to shove their ideology-driven policy forward.,” Issa said in a statement.
The Reublican-led House is expected to vote on a budget proposal from House Budget Committee Chairman Paul Ryan, R-Wis., that would essentially dissolve the auto loan program, the Washington Examiner reported.
At a Thursday hearing on the Energy Department’s 2015 budget, Energy and Commerce Committee Chairman Fred Upton, R-Mich., and Rep. Ed Whitfield, R-Ky., voiced concerns about the reopening the program.
“I remain highly skeptical of the federal government playing venture capitalist,” Upton was quoted as saying. “The revival of the loan guarantee program that backed Solyndra … is of serious concern.”