LPO has $17.7 billion in loan authority to support the manufacture of eligible light-duty vehicles and qualifying components under the Advanced Technology Vehicles Manufacturing Loan Program (ATVM), authorized by the Energy Independence and Security Act of 2007.
To date, the program has loaned $8 billion for projects that have supported the production of more than 4 million advanced technology vehicles. Read more about LPO's ATVM portfolio.
Read our two-page fact sheet for an overview of how LPO can finance auto manufacturing projects.
For more information:
- What value can LPO bring as a lender to my project?
- Is my project eligible?
- What kind of financial terms can LPO provide?
- What is the process for obtaining a loan?
- What are the costs & fees?
- Where can I find more detailed information about the ATVM program?
- How do I apply?
ATVM is one of three distinct loan programs administered by LPO, but all can provide a similar value to borrowers:
- Access to Debt Capital: Through ATVM, LPO can provide access to debt capital that is priced at U.S. Treasury Rates for auto manufacturing projects in the United States.
- Flexible, Custom Financing: LPO can provide financing that meets the specific needs of individual borrowers. LPO has experience with corporate, structured corporate, and limited recourse project finance loans. Additionally, LPO has capacity to finance large projects as a sole lender or to fill gaps in financing as part of a group of lenders.
- Committed Partnership: Lenders often prefer to engage with a project when the deal is fully formed; however, LPO encourages early engagement during project development. LPO can take the time to dive deep and understand the project and its technology. And after loan closing, LPO remains a valuable partner to borrowers throughout the entire lifetime of a project.
- Specialized Experience: LPO maintains an in-house team of financial, technical, legal, and environmental experts that has expertise with first-of-kind projects and a variety of deal structures. To date, LPO has provided more than $30 billion in debt financing.
A project must meet all of the following requirements to be eligible for an ATVM loan:
- Manufacture eligible vehicles or components that are used in eligible vehicles. Advanced technology vehicles are defined as light-duty vehicles that meet or exceed a 25% improvement in fuel efficiency beyond a 2005 model year base-line of comparable vehicles; and/or ultra-efficient vehicles which achieve a fuel efficiency of 75 miles per gallon or equivalent using alternative fuels.
- Build new facilities; reequip, modernize, or expand existing facilities; and/or for engineering integration in the United States related to the manufacturing of eligible vehicles or components.
- Be located in the United States. Foreign ownership or sponsorship of the projects is permissible as long as the project is located in one of the fifty states, the District of Columbia, or a U.S. territory.
- Provide a reasonable prospect of repayment
In addition, an applicant must demonstrate that it has sufficient funds to carry out the project and is not dependent on other federal support as described in the applicable federal regulations.
Applicants must also meet all applicable eligibility requirements set forth in the Energy Independence and Security Act of 2007, Interim Final Rule, as amended and corrected, Interpretive Rule, and Technical Support Document regarding determination and calculation methods for “substantially similar attributes” under the ATVM program.
Eligibility of Electric and Alternative Fuel Vehicle Charging Infrastructure
The manufacturing of infrastructure, including associated hardware and software, for alternative vehicle fuels such as electricity, hydrogen, liquefied natural gas (LNG), compressed natural gas (CNG), and biofuels, may be eligible under the ATVM loan program.
The deployment of such infrastructure may be eligible under LPO’s Title 17 Innovative Energy Loan Guarantee Program.
Learn more about eligibility for Electric and Alternative Fuel Vehicle Charging Infrastructure.
LPO can provide flexible, custom financing to meet specific needs of individual borrowers. LPO offers senior, secured debt and can serve as sole lender, or can co-lend with other financial institutions and provide to bank syndicates flexible debt capacity that can be upsized or downsized depending on syndication strategy.
LPO has experience with a range of borrowers deal structures, including corporate, structured corporate or limited recourse project financings.
For more information about the kind of financial terms LPO can provide, including pricing, terms, and structure, read the ATVM Lending Reference Guide.
The interest rate for ATVM loans is the applicable U.S. Treasury rate for the term of the loan with no credit spread.
Potential applicants are encouraged to engage directly with LPO for no-fee, no-commitment consultations to discuss their proposed project and learn about LPO's process before formally applying. Email firstname.lastname@example.org to request a consultation with an LPO staff member.
FORMAL APPLICATION PROCESS
The following provides a broad overview of the ATVM application process.
Potential applicants may refer to Guidance for Applicants to the Advanced Technology Vehicles Manufacturing Loan Program for more information on preparing an application, and should also review all governing documents on the LPO website.
Application Intake Process
- LPO evaluates project for basic eligibility.
- LPO evaluates technical, financial, environmental, and legal aspects of project for ATVM viability thresholds.
- LPO invites eligible applicants to preliminary due diligence.
Preliminary Due Diligence/Preliminary Terms and Conditions
- LPO further evaluates technical, financial, environmental, and legal aspects of the project.
- LPO confirms the eligibility of the vehicle/component, applicant, and project costs.
- LPO provides the applicant with preliminary terms and conditions of a proposed ATVM loan.
- If the applicant agrees to the preliminary terms and conditions, LPO invites the applicant to advanced due diligence.
Advanced Due Diligence & Term Sheet Negotiation
- LPO performs financial, credit, legal, environmental, and market due diligence.
- LPO typically engages external advisors (e.g., legal, technical, financial, market, insurance) to assist in due diligence and structuring. External advisory costs are borne by the applicant.
- LPO reviews project compliance with federal environmental laws.
- LPO structures the transaction, underwrites and negotiates term sheet with the applicant.
- LPO presents the project for credit approval to internal Project Review Committee, external Interagency Review and internal Credit Review Board.
- LPO and applicant co-sign term sheet.
- LPO issues Conditional Commitment.
- LPO and the applicant negotiate and finalize the loan guarantee agreement and project documents.
- LPO and applicant agree on final terms.
- Applicant fulfills conditions precedent to close.
- Applicant pays closing fee equal to ten basis points (0.1%) of the loan principal.
- LPO and applicant execute loan guarantee agreement.
There is no application fee for the ATVM program.
Each applicant is responsible for paying expenses incurred by LPO’s independent advisors in connection with the applicant’s project.
The annual maintenance fee covers LPO’s administrative expenses, other than extraordinary expenses, in servicing and monitoring the loan guarantee through payment in full. The fee is paid each year in advance, commencing with payment of a pro-rated first annual payment on the closing date of the loan guarantee.
The Borrower will be required to pay at the time of the closing of the loan a fee equal to 10 basis points of the principal amount of the loan.
Applicants should review the Guidance for Applicants to the ATVM Loan Program (May 2019), as well as the Interim Final Rule, as amended and corrected.
Governing Documents: Refer to the ATVM Governing Documents web page.
Environmental Compliance: Refer to the ATVM Environmental Compliance web page.
FAQs: Refer to ATVM FAQ webpage.
Potential applicants are encouraged to engage directly with LPO for no-fee, no-commitment consultations to start a conversation about the project and about LPO's process before formally applying. Email email@example.com to request a consultation with an LPO staff member.
In addition to the Interim Final Rule, potential applicants should refer to Guidance for Applicants to the Advanced Technology Vehicles Manufacturing Loan Program for additional guidance prior to formally applying.
LPO accepts ATVM applications at any time.