Chrysler may benefit from further aid from US authorities in the form of a federal loan to help it re-equip factories to make more fuel efficient vehicles, reports suggested today.

The US group, which is part-owned by Fiat, has already had billions in state-aid as it fought off the economic downturn.

However, citing sources familiar with the matter, the news agency Reuters has reported that the Energy Department is likely to award Chrysler such aid before General Motors, whose IPO may be complicated by such assistance.

It is unclear how large the loan will be, although the carmaker has applied for around US$10bn in credit.

Full details of the story can be found here.