U.S. Energy Secretary Steven Chu will travel Tuesday to Dearborn to announce the agency has approved Ford Motor Co.’s request for billions in federal loans to help fund the development of new, fuel-saving vehicles and technologies, according to several people with direct knowledge of the situation.

Ford, along with the other Detroit automakers and some foreign manufacturers, applied for loans under the $25 billion Department of Energy loan program, which was approved by Congress in September.

Chu also was to announce Tuesday loan funding for Nissan Motor Co. and Tesla Motors Inc., the Associated Press reported Monday.

Ford said in its business plan submission to the Senate Banking Committee in December that it expected to receive $5 billion through the program by 2011.

The loan program was included in a 2007 energy bill, but without the money to pay for it. After prodding from Michigan lawmakers and the auto industry, Congress finally allocated the funds last fall.

Since then, lawmakers from auto manufacturing states have pushed for speedier decisions on the applications. Last month, the Michigan congressional delegation asked Ed Montgomery, who heads up the Obama administration’s efforts to aid auto-dependent communities, to push the Energy Department to accelerate delivery of the loans.

The lawmakers are also seeking a doubling of the loan program to $50 billion.

Chu was in Battle Creek on Monday, announcing $32 million in Department of Energy grants available to Michigan for energy efficiency or alternate energy projects.

Nissan has applied for an undisclosed amount of assistance, while Tesla has sought $450 million.

The Energy Department declined to comment on the plans. Chu has not yet announced the first recipients of the loans, which have been closely watched by members of Congress from states with auto plants and suppliers.

Nissan is developing an all-electric car with 100 miles of pure battery range for release in late 2010. The car will be made in Japan initially, but company officials have said they eventually want to build the vehicle at Nissan’s plant in Smyrna, Tenn.

Nissan spokesman Fred Standish said the automaker hoped “to be approved for this loan as we provided a very strong business proposal. At this time, we have nothing further to say or to announce.”

Tesla is seeking $350 million in loans for an assembly plant to build its Model S four-door sedan, which is scheduled to go on sale in 2011. The San Carlos, Calif.-based company is also seeking $100 million to finance an advanced battery and powertrain manufacturing facility.

Tesla spokeswoman Rachel Konrad referred questions about the loan program’s timing and approval to the Energy Department.



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