It's a drastic step, but as CBS News Business Correspondent Anthony Mason reports, some experts believe it's the best choice.
The General Motors that the president's auto task force was touring is, according to its own auditors, a company on the brink.
So what would bankruptcy mean for GM, the auto industry and for us?
"Well, if GM were to file bankruptcy, the real key is - in a restructuring mode - how they do it," says Joe Serra, a Michigan car dealer.
Bankruptcy for the country's largest automaker would cost at least another $50 billion. With the banking system crippled, the government would have to help organize and pay for it, but it could be a bargain.
"The faster option is the cheaper option," says industry analyst John Casesa.
Casesa says a bankruptcy judge could move much more quickly to streamline GM.
"You will notice dealers going dark very soon," Casesa says. "You will notice plants closing very quickly. Products being cancelled. Things that would otherwise take years in a bailout scenario."
Retirees would likely see their medical benefits cut deeply. Lenders who own GM's debt might be offered 30 to 40 cents on the dollar. Most vulnerable could be the parts suppliers waiting to get paid by General Motors.
"The bankruptcy court is looking at every payment, to whoever it is, and basically freezing everything," says Kevin Tynan with Argus Research. "The supply base can't handle that right now."
Meanwhile, unionMonday that included freezing wages and slashing benefits - concessions made in hopes of keeping the automaker competitive.
Ford has not sought government funding like GM and Chrysler, and is the first U.S. automaker to reach an agreement with its unionized workforce. Ford's deal with its staff was expected to serve as a model for similar agreements for GM and Chrysler.
If hundreds of parts suppliers, many already on the edge of bankruptcy themselves, don't get help too, that could shut down the entire auto industry.
"You can put money in the house, but if you're not going to fix the foundation, it's all coming down anyway," Tynan says.
But unless that happens, GM's customers probably won't feel the impact. There will be fewer dealerships to service vehicles. But warranties would still be honored by subcontractors set up by the bankruptcy court.
"I think ultimately the consumer benefits from all this," Tynan says. "Once we go through the pain. And there's gonna be a lot of pain."
The sooner we take that pain, analysts say, the faster the auto industry can get on the road to recovery.