Department of Energy Loans Alcoa $259 M

Alcoa will borrow $259 million from the U.S. Department of Energy to expand its automotive aluminum sheet production capacity.

The loan will mark the first time that a supplier has accessed money from the dormant $25 billion Advanced Technology Vehicles Manufacturing (ATVM) fund established by Congress during the the Bush administration to fund development of advanced vehicle technologies. The same fund loaned money to Tesla, Nissan, Ford and Fisker.

Alcoa, one of Ford’s primary suppliers for aluminum sheet metal used in the new F-150 pickup trucks, plans to use the loan to finance the majority of its $275 million plant expansion in Tennessee.

SEE ALSO: 2015 Ford F-150 Review

This will also be the first time that the DOE fund distributes cash since 2011 when it stopped dispensing money to Fisker following a series of failures to meet predetermined performance milestones. The high profile failure was met with controversy after Chinese investors bought Fisker.

Between 2009 and 2011, the ATVM find laoned over $8 billion to the four companies that accepted the government loans. Last year U.S. Secretary of Energy Ernest Moniz began revamping the program to be more attractive to suppliers an a move that will help the ATVM use the roughly $16 billion it has remaining in its coffers.

Alcoa began its expansion in 2013, but the ATVM loan news comes shortly after Ford announced that its second F-150 production line is underway.

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