GM asks U.S. gov't for $2.6 bln to build hybrids

DETROIT (Reuters) – General Motors Corp has asked for $2.6 billion of low interest government loans to support the development of three new hybrid vehicles, according to a business plan update released on Wednesday.

GM’s loan request, which would help develop two spinoffs from its all-electric Chevrolet Volt, raises to $10.3 billion the aid it is seeking under a U.S. Energy Department program designed to support development of fuel-efficient vehicles.

The request for low-interest taxpayer backed loans was made on Monday to the U.S. Treasury Department, GM said. It was the automaker’s third request for loans under the program.

It was also the first time GM has confirmed that it intended to move ahead with production of variants of the Volt, a battery-powered car that will carry a small, 1.4-liter engine as a generator designed to kick in after 40 miles. (64 km)

The Volt, which is scheduled to go into production in late 2010, remains one of the most closely watched upcoming GM vehicles and has been central to the automaker’s attempt to reinvent itself in the eyes of consumers.

Reuters