GM, Ford in Ethanol Deals

General Motors Corp. and Ford Motor Co. said Wednesday that they would join with energy companies to promote the use of ethanol as an alternative to gasoline in Illinois and Missouri.

GM will team with Shell Oil Products U.S. and VeraSun Energy Corp. to add 26 ethanol fuel stations in the Chicago area. Ford and VeraSun will convert 40 gasoline pumps in Illinois and Missouri to dispense E85, a mixture of 85% ethanol, which is made from crops such as corn, and 15% gasoline. Details and financial terms were not disclosed.

Increasing the availability of E85 will make it easier for automakers to sell more “flexible-fuel” cars, which can run on fuel containing as much as 85% ethanol. GM and Ford have said they plan to increase sales of the vehicles this year.

GM sold 270,000 flex-fuel vehicles last year and plans to make 400,000 this year. Ford produced 250,000 of the autos in 2005 and has said it may build 280,000 this year. The fuel produces fewer pollutants than regular gasoline.

Ford also said it planned to place Escape gasoline-electric hybrid SUVs with Chicago taxicab fleets starting in 2007.

Ford shares rose 14 cents to $8.23. GM shares fell 82 cents to $21.99.