Amid frantic negotiations to try to secure Republican backing for a multi-billion dollar bailout for automakers, US Senate Majority Leader Harry Reid announced that the Senate had failed to reach a compromise deal.
Embattled US auto giant General Motors has hired legal advisers to consider "all options", including filing for bankruptcy, as the US Senate debates an emergency bailout package for the US auto industry.
The bailout for US car manufacturers faces a tough challenge in the Senate after the House of Representatives approved a 14-billion-dollar rescue plan. Strong Republican opposition threatens to derail the legislation.
The US House of Representatives has approved a 14-billion-dollar rescue plan for the "Big Three" US car manufacturers. The measure now moves to the US Senate, where it is expected to face stiffer Republican opposition.
The White House and Congress said on Tuesday they had agreed on the outline of a 15-billion-dollar bailout plan for the US auto industry but added that negotiations on the content of the future bill were still going on.
Leading opposition figures and economists alike questioned the feasibility and relevance of President Nicolas Sarkozy's recently unveiled stimulus package, suggesting the plan was more an exercise in damage control than a turnaround.