WITH US Congress gridlocked and the economy flailing, the Bush administration declared yesterday it would step in and prevent the 'precipitous collapse' of the US auto industry and the disastrous economic impact of the hundreds of thousands of job losses that would be sure to follow.

A day after the sudden demise of rescue legislation in Congress, General Motors officials were talking with the administration and the Federal Reserve about how carmakers could still get the billions of dollars they say they need to survive. The talks included conditions that automakers would have to meet, said GM spokesman Greg Martin.

Bush administration officials said no decisions had been made on the size or duration of the new rescue plan, or what type of concessions, if any, would be demanded from the struggling automakers, their workers, stockholders or others.

In a reversal, the most likely option under consideration involved billions of dollars originally ticketed for the bailout of the financial industry. President George W. Bush had long declared that money off-limits to the beleaguered automakers.

General Motors Corp. and Chrysler LLC have warned they are running out of cash and face bankruptcy without some form of assistance. Ford Motor Co., which is in somewhat better shape financially, has been seeking access to a line of credit.

Underlining its difficulties, GM announced yesterday it would cut another 250,000 vehicles from its first-quarter production schedule, a third of its normal output, by temporarily closing 21 factories across North America. The move affects most plants in the United States, Canada and Mexico. Many will be shut for all of January.

Urgent requests for White House intervention to save the automakers came from President-elect Barack Obama, Republican and Democratic members of Congress and outside groups.