WASHINGTON (Reuters) - President George W. Bush will not allow a "disorderly collapse" of the struggling U.S. automakers and is nearing a conclusion on if and how to provide them with financial aid, the White House said on Thursday.
Options include tapping money from the $700 billion rescue package that was designed for helping financial institutions as well as helping the automakers navigate through a bankruptcy proceeding, White House spokeswoman Dana Perino said.
A day after Chrysler LLC said it would stop manufacturing for a month, Perino said that the administration was still gathering information from the automakers, digesting it and determining what kind of assistance could be provided.
"The president is not going to allow a disorderly collapse of the companies. That is not an option," Perino told reporters. "We're nearing a conclusion, we're narrowing options, I just don't have anything for you today."
She said that the administration was taking into account Chrysler's decision.
Bush has said repeatedly that the administration would only help those automakers that would be able to survive over the long term and that he did not want to put good money after bad.
There is an "orderly way to do bankruptcies that provides for more of a soft landing," Perino said. "That would be one of the options. I'm not saying that is necessarily what would be announced."
Perino said the administration has committed to help the automakers in some capacity after Congress failed to pass legislation last week, it was just a question of how.
Because the economy was in a recession, "the overwhelming evidence is that the collapse of the American auto industry would have a terrible, negative consequence for our national economy, resulting in massive job losses, the failure of many businesses who are dependent on the auto industry," she said.
"The ripple effect would be quite strong," Perino said.
(Reporting by Jeremy Pelofsky, editing by David Alexander)
