White House says mulling TARP funds for automakers

ABOARD AIR FORCE ONE (Reuters) - The White House said on Friday it was considering tapping a $700 billion financial industry bailout fund to prevent a collapse of ailing U.S. automakers.

"Given the current weakened state of the U.S. economy, we will consider other options, if necessary including use of the TARP program, to prevent a collapse of troubled automakers," White House spokeswoman Dana Perino told reporters aboard Air Force One as Bush headed to Texas.

A willingness to consider use of TARP funds marked a dramatic reversal for the Bush administration after a proposed bailout of U.S. automakers failed in the Senate on Thursday night, raising the specter of an industry collapse.

(Reporting by Tabassum Zakaria, writing by Matt Spetalnick)