U.S. automakers seek Fed loans to ride downturn-WSJ

DETROIT, Aug 22 (Reuters) - The Big 3 Detroit-based automakers are seeking about $25 billion in federal loans as they struggle to ride out a steep downturn in U.S. auto sales, The Wall Street Journal reported on Friday.

The U.S. automakers -- General Motors Corp GM.N, Ford Motor Co (F.N) and Chrysler LLC -- briefed White House officials, Congressman John Dingell and Michigan Democrats on a possible bailout and plan to unveil the proposal next month, according to the report.

The plan is for the government to lend some $25 billion to the automakers in the first year at an interest rate of 4.5 percent, or about one-third what the companies are currently paying to borrow, the report said.

Under the proposal, the government would have the option of deferring any payment at all for up to five years, the article said.

Representatives at GM, Ford and Chrysler were not immediately available for comment.

GM Chief Executive Rick Wagoner said on Thursday that the top U.S. automaker was seeking federal loan guarantees for itself and its suppliers. He declined to say how much the company was looking to borrow under such a program if it were approved by the government.

The Detroit Free Press reported earlier this month that executives at GM, Ford and Chrysler met to agree they would need about $40 billion to ride out their current troubles, and the way out of the losing streak would be a government bailout. (Reporting by Soyoung Kim; Editing by Lisa Von Ahn)