Federal Loans that are available to automakers thanks to the Energy Independence and Security Act of 2007 and more recent legislation, are a hot item lately, with the auto industry's need to quickly retool to increase the manufacture of smaller economy cars. Phasing out many truck and SUV models, the auto industry is in bad need of capital to convert plants for the production of small cars.

Making things worse, these companies also suffered a deterioration in their credit rating as well as current loan interest rates hitting 13% and more due to slowing car sales. In order to qualify for the low interest federal loans, automakers will be required to manufacture cars that will surpass all previous emission and fuel economy standards.

Not only are the loans available to the US auto industry, but to foreign manufacturers in the US and parts suppliers as well. The new Chevrolet Cruze is expected to be one of the first small cars to come out of the federal loan program. Slated for distribution in the US in 2010, the Cruze compact, built in the retooled Lordstown Ohio factory, will achieve 45 mpg to lead the fuel economy race in its segment.