The Bush administration is seriously considering "orderly" bankruptcy as a way of dealing with the desperately ailing US auto industry, White House spokeswoman Dana Perino said yesterday.

"The president is not going to allow a disorderly collapse of the companies," Perino said. "A disorderly collapse would be something very chaotic that is a shock to the system."

However, "there's an orderly way to do bankruptcies that provides for more of a soft landing," she said. "I think that's what we would be talking about."

Perino emphasized there were several approaches to assisting the automakers, such as short-term loans out of a US$700-billion Wall Street rescue fund.

But Bush has opposed this approach before, and it is also adamantly opposed by many other Republicans.

"It's in the spectrum of options and there are a lot of options," Perino said.

Perino would not put a timetable on when an announcement on an auto rescue plan would come, and suggested it may not happen this week. But it is not an option to do nothing, she said.

"If you thought that our economy today could handle the collapse of the American auto industry, then you might come to the conclusion that doing nothing was an option," she said. "We're going to do something."

On Dec. 11, a US$14-billion loan package aimed at bailing out the American auto industry from bankruptcy officially died as it was rejected by the US Senate by 52-35 on a procedural vote.

The collapse came after the United Auto Workers union had refused to agree to steep wage cuts by 2009 to bring their pay into line with Japanese carmakers.

Of the country's biggest three automakers, General Motors Corp. and Chrysler LLC have warned they could be weeks from collapse, while Ford Motor Co. said it may not need the fund right now.

After the failure in the Senate, analysts said it was now up to the Bush administration on whether to use Treasury Department's US$700-billion financial rescue fund to help the auto industry.