Is the Energy Secretary Under Political Pressure to Reject Chrysler's Loan Request?

U.S. Energy Secretary Steven Chu speaks out on Chrysler's request for a $3.5 billion loan. “We're looking at the loan on its merits,” Chu told Benzinga and other reporters at the North American International Auto Show last week, addressing the question of whether or not he is under political pressure to reject Chrysler's request. “We're working with Chrysler. There are pressures for and against. You know, in the end, we have to look at what the statute says. We have to look at what we think would be good for America's workers and the American car industry. And we're going to do what we were charged to do.” When asked if it was just a coincidence that politicians were seen at Chrysler's booth but not at Ford F or GM GM, Chu replied, “That was a coincidence.” He laughed, adding, “It was truly a coincidence.” As far as the timeframe is concerned, Chu said that we will have to wait and see. “We're continuing to work with them,” said Chu. “Chrysler, with the others, has bounced back remarkably well. Chrysler has, the last couple of months, the biggest increase in relative sales. And they're coming up with exciting new cars, and they're making this transition – it was primarily an SUV and pickup truck company – and they're making this transition to selling cars, which I think is great. Most of the market will be in cars.” And with that, one reporter asked, “Does it matter that they're no longer a U.S.-owned company?” “They make their cars in the United States,” Chu answered. “There are American jobs in the United States. So I think, you know, it's a partnership between Fiat and Chrysler.” With regard to auto manufacturers in the United States, Chu said that we can compete “on quality and have moderate priced cars that are just fantastic quality.” He said that instead of thinking they have to make a particular type of automobile, automakers are able to design the cars they actually want to build. “I feel a fundamental difference than we're seeing before, which is great because,” said Chu. “As I said before, we got a billion cars on the road worldwide. We're gonna get to two billion cars on the road worldwide. That's explosive.” But most of that growth will not occur in America. “So what do you want to do?” Chu questioned. “You want to design cars here. Whether another country insists that you assemble it in another country, you still want it designed here, you still want to make a lot of the parts here, and you want to build ‘em here, and ship ‘em worldwide.” Finally, Chu took a moment to speak on the progress of fuel cell research. “Fuel cells are something we continue to do research in,” he said. “There's great increases in the technologies of fuel cells. There are two types of fuel cells: stationary and automotive. The stationary fuel cells have a life of their own – they're taking off. They're a very good alternative to diesel backup generators, as an example.” Chu said that automotive fuel cells are different because “you need a very different infrastructure, but certainly the cost of the fuel cells is coming down and the amount of reliability is going up.” “The amount of platinum you need has gone down five-fold,” he continued. “[That's] a big deal – to decrease the amount of platinum in the membranes five-fold.” But Chu said that there are other issues to consider, particularly with the infrastructure. “We look at all those things,” he said. “And finally storage. So we've continued to invest in research; for fuel cells, for the storage, for the conversion – because in the end you're converting one form of energy into another form of energy.” Follow me @LouisBedigian