WASHINGTON -- The Bush administration is examining options for providing emergency financial help to spur a merger between General Motors and Chrysler, according to government officials.

People familiar with the discussions said the administration wanted to provide financial assistance to the deeply troubled Big Three Detroit automakers, possibly by using the Treasury Department's wide-ranging authority under the $700 billion bailout program that Congress approved this month.

Another option under consideration is to tap a $25 billion loan program that Congress just created to help the auto companies modernize their plants. A third option would involve going back to Congress, after the Nov. 4 election, for authority to spend money designated specifically for the auto industry. But officials have not yet decided how much assistance to provide or how to structure any aid program.

GM and Chrysler's parent company, Cerberus Capital Management, are in talks to possibly merge the two companies, which are losing sales and hemorrhaging cash. Any financial help from the government could help provide a level of confidence to investors in such a deal, and possibly cover some of the revamping costs of a merger, which would be substantial.

The government's bailout program was originally created to rescue banks and other financial institutions, but the Treasury Department decided last week to allow some insurance companies to participate as well.

The automobile industry and lawmakers from Michigan are now arguing that the car companies should be included, because their financing subsidiaries, which have been starved for credit, represent an important channel for consumers to get loans to buy cars.

Any federal help for the financing units could be used to provide car loans, which is seen as crucial to increasing sales. Many dealers have had trouble closing sales because of tighter lending standards.

`VERY SERIOUS'

On Monday, White House officials said the car companies might be eligible for help under the broader financial rescue program, known as the Troubled Assets Relief Program, or TARP.

''It's clear that the automakers are dealing with a very serious situation; they have for some time,'' Dana Perino, the White House press secretary, told reporters on Monday.

''Automakers do have financing arms -- many of them do -- and it's possible that some of those financing arms could be a part of the rescue package,'' she continued. ``We're trying to work with them as much as we can.''

A spokesman for GM, Greg Martin, said Monday that the company had been asking the Treasury Department to extend aid to automakers as it had to other troubled industries.

''We believe the federal government should consider using all the tools available to it, including some recently enacted, to support industries that are in distress and that are essential to the U.S. economy,'' Martin said.

A spokeswoman for GMAC Financial Services, Gina Proia, said the auto-finance operation, a subsidiary of GM, was also seeking assistance from the Treasury.

''At this point we are working with the government officials to understand the application process of TARP and other programs to determine any potential participation by GMAC,'' she said.

The three major American car companies had already been struggling with slumping car sales, soaring gasoline prices and huge losses. But their financial conditions became much worse in the last two months as the credit markets froze, unemployment jumped sharply and the economy reached the brink of a recession.

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