Worst-case scenario?

"We now have three offers to take over Opel," Guttenberg told the newspaper Bild am Sontag on Sunday, May 23. "That does not mean that one of them will automatically and urgently take effect."

"Firstly, we need a high degree of certainty that the considerable sum of taxpayers' money we will have to put up is not lost. None of the three plans sufficiently meets these requirements at present," the minister said.

Guttenberg said Germany's preference would be made known next week, but did not rule out Opel going into bankruptcy if the final bids failed to meet Berlin's requirements.

"If the shortcomings are not lifted, then controlled insolvency would clearly be a better solution," he said. "It, too, could open possibilities for Opel's future."

Three bidders in the game

Canadian-Austrian car parts and assembly group Magna, Fiat of Italy and the Brussels-based subsidiary of US financial investor Ripplewood, submitted offers for Opel by a May 20 deadline.

China's Beijing Automotive Industry Holding Co. (BAIC) has also expressed interest in securing a stake, but has not formally made an offer.

Magna, which has pledged to keep all Opel plants in Germany open but slash 10 percent of the 25,000 workforce, has emerged as the front-runner to take over the carmaker.

But leaders of the four German states where Opel has factories were divided on the offer.

The governor of the German Rhineland-Palatinate state, Kurt Beck, said that the negotiations would continue with all of the bidders, but that the "main focus" would stay on Magna.

North Rhine-Westphalia premier Juergen Ruettgers, however, rejected the plan as "unacceptable" and "unfair" because of the 2,200 jobs that would be at risk in his home state.

According to press reports, Magna was expected to ask the German government for five billion euros ($7 billion) in guarantees, while Fiat was reported to be requesting seven billion euros. German officials declined to comment these figures.

Job cuts a must

Fiat chairman Sergio Marchionne told Bild am Sonntag that a maximum of 2,000 jobs would be lost in Germany under a revised bid submitted by the Italian carmaker.

Canada-based Magna, which has extensive operations in Austria, filed its proposal in conjunction with Russia automotive group GAZ and Russia's Sberbank.

The final decision on the future of GM's European operation will be reached by GM and the US government, but Germany has a stake in the decision as any outcome is likely to rely on German state guarantees.

Meanwhile, GM must present the US government with a viable strategy for survival by May 29 or risk possible bankruptcy.

hf/dpa/AFP/AP
Editor: Toma Tasovac