Uncategorized
Trump budget would cut loan program for vehicle production used by Tesla, Ford
President Trump speaks during an event at the White House in Washington, D.C., on Thursday, Feb. 6, 2020.Al Drago | Bloomberg | Getty ImagesPresident Donald Trump’s proposed budget would reportedly kill a loan program that assisted automakers such as Ford Motor and Tesla in producing more environmental-friendly vehicles, including Tesla’s all-electric Model S.The proposed cut,…
President Trump speaks during an event at the White House in Washington, D.C., on Thursday, Feb. 6, 2020.
Al Drago | Bloomberg | Getty Images
President Donald Trump's proposed budget would reportedly kill a loan program that assisted automakers such as Ford Motor and Tesla in producing more environmental-friendly vehicles, including Tesla's all-electric Model S.
The proposed cut, according to the 2021 budget proposal, is to the U.S. Energy Department's Advanced Technology Vehicles Manufacturing Loan Program, which has distributed more than $8 billion in loans to companies to produce such vehicles, according to the program's website.
Most recently, electric vehicle startup Lordstown Motors, which purchased GM's shuttered Lordstown Assembly plant in Ohio, was in discussion with government leaders about a loan from the Advanced Technology Vehicles Manufacturing Loan Program.
Lordstown Motors, in an emailed statement on Monday to CNBC, said it had not yet applied for the loan. It said the company continues to evaluate its options for financing: “We are continuing conversations with government leaders as we explore our options, but we see it as one of our many options to consider. We will factor this new information into our decision making process, but our business model stands on its own without it.”
A spokesperson for the federal program, which awarded its first loan in 2009, did not immediately respond for comment. The budget refers to the program and others as “costly, wasteful, or duplicative programs.”
Previous loans, according to the program's website, have included $465 million to Tesla for production of the Model S in 2010; $5.9 billion to Ford to upgrade 13 facilities in six states for a variety of vehicles in 2009; and $1.45 billon for Nissan Motor for a new advanced battery manufacturing plant and facility upgrades for a plant in Tennessee for to produce the all-electric Nissan Leaf in 2010.
As of September 2017, both Tesla and Nissan had fully repaid their loans, according to the website. Ford, according to a company spokeswoman, is scheduled to repay its loan in September 2022.
As of 2016, the Advanced Technology Vehicles Manufacturing Loan Program was authorized to loan more than $16 billion to continue “helping the auto industry grow local economies across the United States while increasing American economic competitiveness around the world,” according to the website.
This isn't the first time Trump has wanted to cut funding for the auto industry. The White House last year proposed eliminating a tax credit worth up to $7,500 on the purchase of new electric vehicles, a move it said would save the U.S. government $2.5 billion over a decade. The credits were eventually saved.
Subscribe to Centenunlimited news
We hate SPAM and promise to keep your email address safe
