Berlin - A cabinet minister ruled out a government bailout for the German auto industry on Monday as Chancellor Angela Merkel prepared to meet the management of Opel to discuss state aid.

The troubled carmaker has requested credit guarantees from Berlin to counter a financial squeeze, triggered by dwindling sales and problems with its parent company General Motors.

"A general economic programme for the automobile industry makes no sense," Finance Minister Peer Steinbrueck told the newspaper Bild. "The state cannot act as a replacement for private consumption and is not responsible for the errors of the industry."

Merkel invited the German and European heads of Opel, as well as workers' representatives to Monday afternoon's talks. Meetings with Steinbrueck and Economics Minister Michael Glos are scheduled for Tuesday.

"This way, we'll get familiar with the situation step by step and search for solutions," she said.

Kurt Beck, Prime Minister of the western state of Rhineland- Palatinate, has said Opel is seeking about 1 billion euros (1.27 billion dollars), although the company itself has not named a sum.

An Opel spokesman has said the carmaker would only make use of the guarantees if the situation of GM deteriorated to the point that production and project development at its German subsidiary were affected.

Glos expressed concern that any financial support for Opel could find to its way to GM, which is facing a serious cash shortage.

"We certainly have to know whether the money will remain in Germany," Glos told German television. "Issues related to the American parent still need to be cleared up."

The US Congress was due to meet Monday do discuss a request by GM and fellow automakers Ford and Chrysler for billions of dollars in emergency aid to help them out of the current crisis.

Close to one-in-five workers are employed directly or indirectly in the German automobile sector.

Opel employs 25,700 workers at four factories in Germany. Along with other German carmakers, such as Daimler and BMW, it has announced temporary plant closures after a huge drop in orders.

The state governments of Hesse, North Rhine-Westphalia and Rhineland-Palatinate, where Opel manufacturing plants are located, have signalled that they could take part in the loan guarantees.

Government spokesman Ulrich Wilhelm said Berlin wanted to avoid setting a precedent when it makes a decision on whether to grant state assistance to Opel.

He said the government would do all it could to help the ailing carmaker, but had to take into consideration EU regulations governing competition and subsidies.

Analysts said that granting state aid to a single company could be viewed as discriminatory by Brussels and meet with opposition.

The German parliament last week approved a tax rebate for purchasers of new cars as part of a 12-billion-euro package designed to stimulate domestic consumption. (dpa)