Chrysler Cancels Loan Request from Department of Energy

By Trevor Dorchies | February 17, 2012
Chrysler has announced today that it will no longer be seeking a loan from the U.S. Department of Energy to back hybrid and fully-electric vehicle development. Sergio Marchionne, CEO of Chrysler and parent company Fiat has stated in the past the auto maker needed the loan in order to be competitive, but that no longer appears to be the case. Marchionne now believes Chrysler can develop fuel efficient vehicles all on its own. "While we were continuing to work with Chrysler to come to an agreement, we are pleased that they are capable of achieving their business goals without department support," Damien LaVera, a DOE spokesman told the Detroit Free Press. The 2013 Dodge Dart, expected out later this year  is expected to earn 40 mpg combined and starts at $15,995. Based off Italian automaker Alfa Romeo's Giulietta platform, the Dart will come with standard features such as a 7-inch TFT screen, and 8.4-inch media screen, and your choice of three fuel sipping engines. Features like the "ring of fire" tail lights, as seen on Dodge's popular Charger model, will also be present on the latest interpretation of the Dart.
The $25 billion loan program originally came to fruition back when George W. Bush was in office. There still are $16 billion up for grabs as the DOE has already awarded $9.1 billion in loans to other auto makers. Ford took a loan for $5.9 billion while Nissan received $1.4 billion and even Fisker Automotive, a company that exclusively makes electric vehicles was awarded $529 million in funds. While Chrysler has decided to cancel its request for a loan from the DOE, the Detroit-based auto maker initially asked for $7 billion under the DOE's Advanced Technology Vehicle Manufacturing program back in 2008. The request was later knocked down to $3.5 billion before cancelling the request entirely last month. Chrysler felt the stipulations that came along with the loan were to restrictive plus Chrysler made $183 million in 2011, its first year turning a profit since 2005. "The Department of Energy's proposed terms were very restrictive and compliance would have negatively affected our operational flexibility," Chrysler said in a statement to the Detroit Free Press. Do you think Chrysler will be able to develop a competitive hybrid vehicle without government funding? Sound off in the comment section below. Source: Detroit Free Press Source: Detroit Free Press