The US House of Representatives Financial Services Committee is to hold a hearing next week to consider a bill to provide $25 billion in federal loans to US car manufacturers.
General Motors, Ford Motor Co and Chrysler LLC have been lobbying for assistance as a severe downturn in US car sales pummels their balance sheets.
Chairman of the committee Massachusetts Democratic Representative Barney Frank said the money for the loan would come out of the Troubled Assets Relief Program (TARP), part of the $700-billion financial market rescue law enacted last month, but he said separate legislation to amend the TARP is needed.
"It will be coming out of the TARP if the bill passes," he said, adding that the legislation will be written so it would not necessarily trigger release of the second half of the $700 billion funding for the TARP.
"It won't require you to necessarily trigger the second 350," he said.
The White House has said it would listen to ideas from Congress to help the ailing industry.
"We are going to work with Congress, we are open to their ideas," White House spokeswoman Dana Perino said.
"If they are going to amend or accelerate those funds we will certainly look into their ideas and work with them."
Reuters