New York  - US stocks plunged on Thursday as oil prices dropped to new lows and the White House continued to stall on a possible bail-out for the US car industry.

General Motors Corp dropped 16 per cent and Ford Motor Co fell 10 per cent after spokeswoman Dana Perino said the White House was considering a structured bankruptcy for the struggling industry.

GM, Ford and Chrysler LLC are all shutting down manufacturing plants as cash reserves run out and demand for cars has plummeted in the current credit crisis. GM and Chrysler have warned they will go bankrupt without federal aid.

Crude oil plunged 9.6 per cent to 36.22 dollars per barrel in New York trading. The price had dipped below 36 dollars earlier in the day for the first time since July 2004. Shares in Exxon Mobil Corp and Chevron Corp each lost about 5 per cent.

The blue-chip Dow Jones Industrial Average fell 219.35 points, or 2.49 per cent, to 8,604.99. The broad-based Standard and Poor's 500 Index shed 19.14 points, or 2.12 per cent, to 885.28. The technology- heavy Nasdaq Composite Index dropped 26.94 points, or 1.71 per cent, to 1,552.37.

The US currency fell to 66.59 euro cents from 69.42 euro cents on Wednesday. But the dollar rose against the Japanese currency to 89.41 yen from 87.26 yen on Wednesday. (dpa)