Loans for automakers and parts suppliers from a $25-billion pool expected to pass Congress this week might not reach the industry for six to 18 months, the U.S. Department of Energy said Thursday.

Detroit automakers are facing a cash crunch that is expected to last through 2010, and lawmakers added requirements to the loan program this week to speed the process of handing out funds.

Under the bill, the DOE must write the rules for the loans within 60 days of the bill becoming law. But DOE spokeswoman Healy Baumgardner said Thursday that the agency had “significant doubts about whether distribution of loans by January 2009 is realistic.”

“Because there are a number of legal and administrative requirements with which the department must comply, such as the National Environmental Policy Act, we anticipate it could take at least six to 18 months or more” before loans are granted.

Rep. John Dingell, a Dearborn Democrat, said in a statement that the agency was “making excuses for its own anticipated failures,” adding that “I hope this statement is not a sign of continued indifference to the U.S. auto industry on the part of the Bush administration in its waning days.”

Wall Street firms have estimated that the loans could sharply reduce the cash needs of General Motors Corp. in 2009, and at Chrysler LLC to a lesser degree, while also helping dozens of suppliers.

Source: DetroitFreePress

Looks like someone has a vested interest in the Detroit automakers demise, or at the very least slowing down their ability to change over their line up to meet the new market needs.