The White House said on Thursday it was considering an "orderly" bankruptcy for the US's stricken auto companies in its clearest warning yet that General Motors (NYSE: GM - News) or Chrysler could be forced to file for Chapter 11 protection or similar measures.

Dana Perino, President George W. Bush's spokeswoman, told reporters the administration was "very close" to making a decision as to how to help the two companies, which have said they need an emergency $15bn to continue operations until the end of March.

Over the past week, the two companies have announced the idling of their North American factories for at least a month apiece.

Ms Perino added that two options the administration was considering were tapping the Treasury's troubled asset relief programme for the funds and "one of these bankruptcies".

The Detroit companies have presented the Bush administration with perhaps the biggest dilemma of its last days in office, particularly since opposition from Republican senators last week doomed legislation to authorise the aid, handing the problem to the White House.

Mr Bush maintains that a disorderly collapse of one or more of the Detroit Three could have a devastating "ripple" effect throughout the economy. But he is under mounting pressure from Republican legislators who demand federal conditions on the sector in return for any loan.

"In ordinary circumstances, failing entities should be allowed to fail," Mr Bush told the conservative American Enterprise Institute on Thursday. "I have concluded these are not ordinary circumstances, for a lot of reasons."

Many Republicans have called for the car companies to declare Chapter 11, largely to facilitate renegotiation of labour contracts, debt obligations and other contractual arrangements. They argue that such steps are necessary to reduce the risk that the auto companies ask for billions of dollars in further aid in a mere matter of months.

One increasingly discussed option on Capitol Hill would be to provide federal aid in conjunction with bankruptcy protection, since commercial banks could be unlikely to lend to companies in Chapter 11.

"There's an orderly way to do bankruptcies that provides for more of a soft landing," Ms Perino said on Thursday. "I think that's what we would be talking about. I'm not saying that is necessarily what would be announced."