Bush Considering 'Orderly' Auto Bankruptcy

Chrysler spokeswoman Shawn Morgan noted previous statements against bankruptcy by CEO Robert Nardelli. Financing even a prepackaged bankruptcy would be difficult in the current tight credit market, Chrysler has said.

Map shows number of population employed at Chrysler plants;

(AP)

Cerberus Capital Management LP owns 80.1 percent of Chrysler and a 51 percent stake in GMAC. The New York private equity firm has said its investors are composed of pension funds, university endowments and family investors who are limited in the amount of additional money they can provide to Chrysler.

The National Automobile Dealers Association also spoke out against bankruptcy for car companies "in any way shape or form, orderly or disorderly, prepackaged or unpackaged, managed or unmanaged," said spokesman Bailey Wood.

Bush said the auto industry is "obviously very fragile" and he is worried about what an out-and-out collapse without Washington involvement "would do to the psychology" of the markets.

"There still is a lot of uncertainty," he said.

At the same time, the president said anew that he is worried about "putting good money after bad," meaning taxpayer dollars shouldn't be used to prop up companies that can't survive the long term.

He revealed one other consideration — that Obama will become president in just over a month.

"I thought about what it would be like for me to become president during this period. I believe that good policy is not to dump him a major catastrophe on his first day in office," Bush said.

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Associated Press writers Julie Hirschfeld Davis and Ken Thomas in Washington, Tom Krisher and David Goodman in Detroit and Bree Fowler and Stevenson Jacobs in New York contributed to this story.

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