The senate passed a bill that will likely total over $600 billion in spending measures on tuesday. Of that $25 billion is for backed loans to the auto industry.  The house of representatives will likely vote on the bill today.

The inclusion of the low-interest loan guarantees is a victory for struggling U.S. manufacturers General Motors Corp, Ford Motor Co, and Chrysler LLC, which is controlled by private equity firm Cerebus Capital Management LLC.  All three automakers have been lobbying congress for flexible low interest loans.  They claim that the current loans are too rigid with how they spend their money.  The Detroit three need more capital to fund research and technology like Chrysler’s ENVI products and the Chevy Volt.

“I’m not a fan of the American auto industry and I’m not a fan of this provision. But Congress authorized it and we’re providing the funding for it,” said Obey, a Wisconsin Democrat.

Included in the package is a tax rebate for people tha buy plugin hybrid vehicles. The credit starts at $2500 and goes up to $7500 based on the type of vehicle bought. The credit doesn’t phase out until the automaker has sold 250 thousand plugin hybrids.

Source: Reuters