US automaker General Motors' German affiliate Opel has seen its survival hanging in the balance in recent weeks with no support from its parent company or the German government in sight.

Eighty years after being acquired by GM, Opel was plunged into crisis by its beleaguered parent, which is facing the threat of bankruptcy under the impact of the worst financial crisis in decades.

GM registered a US$30.9-billion loss last year and said that 2009 would be a tough year, despite US$13.4 billion in aid from the US government.

If Opel collapses, around 400,000 jobs will be lost across Europe, with 25,000 of those at the four plants in Germany.

Bailout plan shelved

To exit the quagmire, GM has submitted to the German government bailout plan that features 3.3 billion euros (US$4.2 billion) in aid from Germany and other European countries where it operates factories.

But Chancellor Angela Merkel has said that GM must overhaul the rescue plan and her government would aid Opel only if the benefits outweigh the costs.

"We will support firms like Opel only if our help ensures a good future for these companies and doesn't just uselessly go up in smoke because a company has failed in the market," she said.

A decision on state aid for Opel will take weeks, said Economic Minister Karl-Theodor zu Guttenberg.

Analysts said German officials are worried that Opel's strong dependence on its parent would result in state aid being siphoned off to the United States.

Besides, other companies may also rush to grab state aid if the government aids Opel, as they are also struggling to cope with an unfavorable market climate this year.

To ensure politicians that the funding will not flow to the United States, "GM proposes to place Opel into a legally separate holding company into which it will transfer about US$3.8 billion -worth of non-cash items," said an article posted on The Economist web site on March 5.