The Obama administration will offer US car dealers loans of up to US$2m to help buy vehicles and maintain inventories, members of the Senate’s Small Business Committee have said.
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The US Small Business Administration’s pilot programme will provide loans of $500,000 up to $2m that are repayable over five years and backed by a 75% government guarantee, according to Senator Mary Landrieu, the Democrat who chairs the committee, and Senator Olympia Snowe, the top Republican on the panel, Reuters reported.
“The SBA’s plan to offer floor plan loans to America’s dealerships will help small businesses stay open in this uncertain economy,” the senators said in a joint statement. “These loans will enable dealerships to maintain their inventory and save jobs.”
The pilot programme starts on 1 July and extends to 30 September, 2010, when the federal agency will decide whether to continue it.
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