Jaguar Land Rover and Nissan's Sunderland factory could be awarded hundreds of millions of euros next week for green technology development.

The European Investment Bank (EIB) will decide on Tuesday whether to award about €500 million (£453 million) to the two operations, money that then will be underwritten by the Government.

Jaguar Land Rover, which is also seeking an additional £500 million in loan guarantees from the Government, has asked the EIB for €300 million. Nissan has asked for €400 million for Sunderland and for its plant in Spain.

The loans will be the first awards from a £2.3 billion support package for the British car industry announced by Lord Mandelson, the Business Secretary, in January. Another application to the European bank for a loan from LDV, the struggling Birmingham vanmaker owned by Oleg Deripaska, the Russian billionaire, is thought not to be ready. The loss-making LDV has said repeatedly that it is running out of cash as it tries to find a buyer.

Jaguar Land Rover, which is owned by Tata, the Indian conglomerate, has said that a £500 million package of loan guarantees from the Government is needed for its operations in the West Midlands and on Merseyside, but a decision is not thought to be imminent. The Department for Business is considering the request with NM Rothschild, its adviser. The carmaker has tried to borrow money from the big banks, including Royal Bank of Scotland and Lloyds Banking Group, but was turned away.

Last month, Ratan Tata, head of the Tata group, vented his frustration against the British Government, which has large shares of both banks, warning of job losses and temporary plant closures if guarantees that could trigger commercial loans were not forthcoming.

Tata, which also owns the Anglo-Dutch steelmaker Corus, has owned Jaguar Land Rover for only a year but it has suffered a dramatic fall in sales of Land Rover vehicles in that time amid weak markets, although Jaguar has held up over recent months thanks largely to the XF, its latest model.

The Government has been insisting that Tata puts in money to support the carmaker, but the conglomerate has complained that it has already invested £800 million in the business.

Its application to the EIB is for money to develop technology to reduce the CO2 emissions of its cars. The overall project will cost €600 million.

Nissan is seeking help to boost the efficiency of its powertrains in Britain and Spain. It has told the European bank that the total project will cost €1 billion.

Negotiations are expected to continue to try to rescue General Motors Europe, which is expected to run out of cash in the next few weeks. Vauxhall is seeking £500 million from the British Government to take an equity stake in a new GM Europe business, which will be partly split off from its ailing American parent.

Germany, which has the biggest part of GM Europe with the Opel brand, is being pressed by the US carmaker to contribute the lion's share of €3.3 billion from European governments. GM could go into Chapter 11 bankruptcy in a couple of months if restructuring efforts do not convince Washington to give further support. It is attempting to partly separate itself from the European division to focus on its American operations.

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