Federal loan money would help the entire automotive supply and manufacturing chain prevent the US from swapping dependency on foreign countries for oil to depending on them for electric vehicle batteries, a senior Chrysler executive has said.
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Speaking to the Automotive Press Association in Detroit, in apparently unscripted remarks, vice chairman and president Jim Press said proposed federal loan guarantees were not just for automakers or Detroit-based companies, and could lead to greater acceleration in development of new technologies.
He noted the US dependence on foreign oil “which we shouldn’t be” and said: “Fast forward 15 years and where will batteries come from? Right now, the major sources of batteries are other countries. So are we trading our dependence on foreign oil, which is a natural resource, for dependence on other countries to produce something in a factory?
“We need to stimulate that development here, here in Michigan and I think that this money will allow us to do that.”
Press said the federal loan guarantee was part of the energy bill passed last year, increasing CAFE requirements.
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By GlobalData“There was a provision to help manufacturers move out of old technology investments into new technology investments to coincide with the increases in CAFE – makes sense.
“It was done last year, it wasn’t our request, it was done by Congress and in that was a appropriations opportunity that’s just come to the forefront – that’s what’s being debated.
“It applies to every manufacturer, not the Big Three that’s been [manufacturing] here for 20 years, it applies to all of the suppliers, all of the battery manufacturers, all of the technology for electric motors and inverters, all that’s included in this bill.
“It’s a loan guarantee, it’s not a free bail-out, there is money paid-back.
The only expense is a more favourable interest rate than the prevailing rate.
“It’s not a bail-out of the car companies, it allows us to accelerate the development of technology and put it in the hands of customers who can afford it. The battle we have right now with the technology is getting it affordable [so we can sell it in volume].”
Chrysler has a plan to review its CAFE numbers and technology plans and Press said the loan would bring forward new developments by years rather than months.
That would be good for the US industry which would become globally competitive by getting new products “more in tune with the market” on sale faster “than waiting for the product cycles to work through, than waiting to make the money to make the investments”.
He said the loan would be in addition to Chrysler’s planned $3bn capital investment and would pull that forward.
“It wouldn’t be used for anything other than importing and advancing technology in our products.”
