Sept. 12 (Bloomberg) -- General Motors Corp. Chief Executive Officer Rick Wagoner said $25 billion is a ``good amount'' for U.S. government loans to spur the development of fuel-saving vehicles as long as rules are loosened to cover more projects.

Last year's energy bill said that the funding would have to be used on programs to boost fuel efficiency by more than 25 percent. Wagoner told a Senate energy summit today that automakers would also like to be able to apply the loans to projects that help improve mileage by a lesser degree so that more investments can benefit.

Because of tight credit markets, Congress should ``move quickly'' to appropriate funding for the loans, he said.

``GM and our competitors are hard at work making sure we can achieve this objective, which will require a huge commitment of research and development, engineering and capital spending,'' Wagoner said.

GM and Ford Motor Co. shares gained for a third straight day on optimism that Congress will approve funding for at least $25 billion in loans to pay for the fuel-saving technology before a recess at the end of the month for the Nov. 4 election. House Speaker Nancy Pelosi said this week that getting the funding approved is a priority.

GM gained 26 cents to $13.01 at 4:15 p.m. in New York Stock Exchange composite trading. Ford advanced 23 cents, or 4.9 percent, to $4.91.

Consistency Wanted

GM and other automakers also need a consistent U.S. energy policy to support the development of fuel-saving technology in future models, Wagoner said.

Meeting last year's mandate to reduce future fuel use in vehicles by 40 percent and shifting to electric and hydrogen- powered models will require a ``massive investment in new technologies,'' Wagoner said at today's summit.

Senators, including Senate Energy and Natural Resources Committee Chairman Jeff Bingaman, a New Mexico Democrat, held meeting today after it was organized by Senate Majority Leader Harry Reid, a Nevada Democrat.

Senator Bill Nelson, a Florida Democrat, said he is concerned that automakers may come back and ask for more than $25 billion.

He told Wagoner it would be hard for him to approve a rescue. Automakers ``opposed us and beat us when we tried to raise'' mileage requirements, he said.

The auto industry isn't seeking a bailout, Wagoner said. The loans were approved last year after automakers gave ``unanimous'' support for increasing fuel economy 40 percent by 2020, Wagoner said.

Ford Aid

Ford CEO Alan Mulally said yesterday the funding would help the automaker, the second-largest in the U.S. behind GM, retool truck plants to build more fuel-efficient cars. He made similar comments today on CNBC.

``The loans are not a bailout. It's part of a very comprehensive energy and independence act,'' Mulally said in an interview. ``The goal is to improve fuel efficiency. There is always a time for partnerships between private industry and the government.''

The loans will speed the development of technology and encourage the creation of battery manufacturing infrastructure in the U.S., he said.

Automakers are asking lawmakers to approve an appropriation funding $25 billion in loans approved in the 2007 energy bill. They had also been seeking as much as $25 billion in future loans.

Loan Provisions

Under last year's energy measure, the auto-industry loans would be for as long as 25 years, with an interest rate set at the cost of funds to the Department of Treasury for obligations of comparable maturity. The loans are limited to paying for 30 percent of any single project, according to that law.

U.S. Energy Secretary Samuel W. Bodman told reporters in Washington he plans to propose rules by year's end for distributing the loans, in the event that money is appropriated.

GM unsecured debt due in 25 years yields 14.6 percentage points over comparable government debt. That's $146 million annually over the cost of government debt in additional interest for each $1 billion.

The auto industry's allies are racing Congress's calendar, because of this month's scheduled recess. Pelosi, a California Democrat, said this week the loans may be attached to one of several bills.

President George W. Bush, who was en route to an appearance today in Oklahoma City, is monitoring the automakers' loan request, White House spokesman Tony Fratto said.

``We want to be very, very careful about the government's role with private enterprises out there,'' Fratto told reporters on Air Force One, the president's jet. ``There are a lot of industries that are dealing with challenging economic conditions, and it's always important to be very cautious about the federal government's role.''

To contact the reporters on this story: Jeff Green in Southfield, Michigan, at jgreen16@bloomberg.net; Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

Last Updated: September 12, 2008 16:36 EDT