Government aid to automakers is not a bailout, Ford CEO says

PARIS (AFP) — Government loans awarded to three major US automakers are justified as they need them to meet new environmental regulations, Ford chief executive Alan Mulally said Thursday.

"This is not about a bailout," the Ford chief executive told AFP in an interview at the Paris auto show.

"It was very insightful what they did with the recent credit tightening, otherwise it would have really slowed down all efforts to being new technology into fuel-efficient vehicles."

Critics have alleged the US firms received an unwarranted subsidy.

US President George W. Bush signed a new energy bill Tuesday after it received approval from Congress.

It includes a 25-billion-dollar (17.8-billion-euro) loan package to help Ford, General Motors and Chrysler adapt to new emissions regulations.

Mulally said the cost of meeting new regulations could be as much as 110 billion dollars.

The money will be used to retool and adapt factories to make smaller, more fuel-efficient cars. Mulally said the extra cash could also be used to develop cars that will be sold Continue reading the remaining 59% ...