Auto industry seeking loans to fix factories

WASHINGTON -- Automakers plan to urge Congress to support funding as much as $50 billion in low-interest loans over three years to help them modernize their assembly plants and develop fuel-efficient vehicles.

Industry officials said the loans, which are twice the amount authorized in last year's energy bill, will be a priority when Congress returns next month, because of the declining fortunes of Detroit's automakers and the tightening credit markets.

The loans would provide low-interest credit for as much as 30 percent of the cost of retooling facilities to build hybrids, plug-in hybrids, electric cars and other alternatives.

Auto industry officials say the loan program is not a bailout but is similar to the aid lawmakers gave to Wall Street investment banks and struggling mortgage firms. They also note that auto companies face tens of billions of dollars in costs from new fuel economy regulations.