WASHINGTON - THE White House on Tuesday demanded that Detroit automakers prove their 'long-term viability' in return for a US$15 billion (S$22.5 billion) rescue bailout, but said a deal with Congress was in sight.

President George W. Bush's administration is making 'good progress' in its talks with congressional leaders over legislation to shore up General Motors, Ford and Chrysler, White House spokesman Dana Perino told reporters.

Senior Democrats said they wanted a bill finalised quickly, including a government overseer or 'car czar,' but Republicans expressed angst about an open-ended commitment to rescue the firms from their own managerial mistakes.

'We are still working through a number of issues, some of them just small and technical, and other ones a little bit more meaty in scope, but, all in all, making sure we're headed in the right direction,' Ms Perino said.

But Ms Perino stressed: 'Our insistence that long-term viability be reflected in the legislation is something that we have held very strong feelings about, and that has not changed.

'There will not be long-term financing if they cannot prove long-term viability.'

Short-term loans of US$15 billion are meant to sustain the car giants through March, allowing president-elect Barack Obama time to address their crisis after he takes office on Jan 20.

Mr Obama has called a collapse of the auto industry 'unacceptable,' but said on Sunday he wanted a supervisory process that would hold the companies' 'feet to the fire.'

GM and Chrysler are first in line after warning they are fast running out of cash. Ford, though equally hampered by slumping sales, says it faces no immediate liquidity crisis but wants a nine-billion-dollar line of credit.

While the Democratic-led Congress was ready to extend a larger amount of aid, the Bush administration has balked at giving any more than US$15 billion and insists - like Mr Obama - that the automakers must retool for the long haul.

White House and congressional negotiators held talks late into Monday and the emerging total proposed is less than half of the US$34 billion the auto giants say they would need to stave off a 'catastrophic collapse.'

House of Representatives Speaker Nancy Pelosi said the automakers must be 'preserved' as it was 'essential to our national security that we have a strong industrial and manufacturing base.'

But government help must not amount to 'corporate welfare,' she told reporters, mentioning former Federal Reserve chairman Paul Volcker as a possible presidential czar to supervise the companies' restructuring.

Influential Republican Senator Richard Shelby, whose state of Alabama hosts assembly plants of Toyota, Honda, Hyundai and Mercedes-Benz, said many in his party were grumbling at the helping hand being offered to the Detroit giants.

Republicans in Congress could not sign off any deal 'because I believe the American people need to know the details of this, to realize this is only the downpayment on a lot of money to come in the future,' he told MSNBC.

The proposed legislation calls for the 'car czar,' a presidential appointee to oversee the overhaul of the Big Three US automakers, which have been losing ground for years to their Japanese rivals.

In return for the loans, the government would get an equity stake and the automakers would have to improve their fleets' fuel-efficiency and also examine using their excess capacity to build bus and rail cars for public transit.

The bill also requires the automakers to sell their private jets and places strict limits on executive compensation, similar to a recent bailout for financial firms buffeted by the global credit crunch and toxic mortgage loans. -- AFP