By John D. Stoll

DETROIT -- The government agency that protects pensions for Americans is raising fresh concerns about the repercussions if one or more of the U.S. auto makers were to collapse, saying 1.3 million workers and retirees could see their pensions slashed if that were to happen.

The head of the U.S. Pension Benefit Guaranty Corp. acknowledged in an interview that General Motors Corp., Ford Motor Co., and Chrysler LLC have well funded pensions according to the standard accounting rules applied by the Securities and Exchange Commission.

But by the PBGC's measures, the pension funds of Detroit's Big Three would be underfunded by as much as $41 billion if one or more of the auto makers went under and killed their pension plans, PBGC Director Charles E. F. Millard said.

"An awful lot of people seem to think these plans are well funded or overfunded," Mr. Millard said in an interview. "Each of these plans is significantly underfunded [and] in three years I don't want people coming back and saying, 'How come the PBGC never told us that?'"

This concern adds fodder to an ongoing debate over what the government's role should be in helping the struggling auto makers from collapsing as the trio face a difficult road in 2009. Some people argue a bailout for Detroit would be a good use of taxpayer money, and that holding back financial aid would result in a collapse, and force the government to spend billions shoring up the companies pension plans.

Mr. Millard estimates that the three auto makers only have enough money in their pension funds to cover only 76% of the pension obligations they have made, if they terminate the pension plans. GM's plan is estimated to be $20 billion, or about 20% underfunded, while Chrysler's plan is 34% underfunded, leading to a $9 billion-plus shortfall, the agency said. Ford's funded ratio is not publicly available, but the company's pension plans are likely running at a $12 billion deficit.

About $13 billion of the estimated $41 billion shortfall would be covered by the PBGC, Jeffrey Speicher, an agency spokesman, said. The remainder represents benefits that PBGC could not pay because of limits set by Congress, and those benefits would be lost by employees and retirees.

If all three companies were to terminate their plans, the PBGC's current deficit would double, as would the number of people receive pensions from the agency.

GM spokeswoman Julie Gibson said the auto maker is in compliance with pension accounting, its pension are adequately funded and it doesn't have any near-term funding obligations. The company could make more contributions to its pension plans in coming years, but it also holds various credits with the Internal Revenue Service that could help fund the pension plans . The auto maker will report an update on its pension status when it releases annual report filing in coming months.

When GM last gave a year-end update on its pension funds, the funds covered more than 400,000 retirees and were overfunded by $18.8 billion. But in November, GM said its plan for hourly workers was underfunded by $500 million because of restructuring expenses. Its plan for salaried employees remains overfunded by at least $500 million. GM, like its rivals, have relied on the pension funds to help cushion its restructuring costs, and that has contributed to a quick deterioration in the health of the funds.

"In regards to our pension plans, we take our obligations very seriously, managing our plans with integrity and prudence even during difficult times," Ford spokesman Bill Collins said. The auto maker's most-recent numbers suggest its U.S. plans 103% funded, or carrying a $1.3 billion surplus with $45.8 billion in plan.

Mr. Collins said Ford will update its funding status when it releases its annual report.

A Chrysler spokeswoman did not return phone calls.

The PBGC steps in to take over failed pension plans, and protects the retirement savings of almost 44 million Americans. Because it is charged with insuring pensions in the event that a business or organization terminates pension plans, the PBGC monitors not only the SEC's accounting requirements, but also attempts to estimate how well-funded the plans would be if they were terminated in a liquidation or some other restructuring.

In recent months, as the cash reserves of GM, Ford and Chrysler have been drained due to slow auto sales and heavy restructuring obligations, concerns over the viability of these auto makers has skyrocketed.

The White House last month issued a $17.4 billion loan package to GM and Chrysler, but that money is only expected to last until the end of March. At that point, if the two car companies can prove they are on the path to sustainability, they may be able to successfully argue for more funding or be able to tell the government that they have stabilized to the point where they don't need government funding.

Write to John D. Stoll at john.stoll@wsj.com