Carbon Motors Says U.S. Energy Department Denies Vehicle Loan

Carbon Motors Corp. said it won’t get a U.S. Energy Department loan it applied for to develop more fuel-efficient police cars.

The Connersville, Indiana-based company said today it had asked for $310 million in financing from the Advanced Technology Vehicle Manufacturing program, which last week declined to give Bright Automotive Inc. a loan to develop electric commercial vans.

The program is one of three Energy Department lending programs drawing scrutiny since last year’s bankruptcy of solar- panel maker Solyndra LLC, a recipient of U.S. loan guarantees.

“We are outraged by the actions of the DOE and it is clear that this was a political decision in a highly-charged, election-year environment,” Carbon Motors Chief Executive Officer William Santana Li said in a statement on the company’s website.

At least 14 members of Congress, including Senator Richard Lugar, an Indiana Republican, wrote to the Energy Department in support of Carbon Motors’s application, according to letters provided by the agency.

“Over the last two and a half years, the department has worked with Carbon Motors to try to negotiate a deal that supported their business while protecting the taxpayers,” Damien LaVera, an Energy Department spokesman, said in an e- mail. “While we were not able to come to an agreement on terms that would protect the taxpayers, we continue to believe that Carbon Motors is an innovative company with an interesting project and we wish them luck.”

To contact the reporter on this story: Angela Greiling Keane in Washington at agreilingkea@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net