Automakers that do pool their efforts will more likely be driven by the high cost of future requirements to replace the internal combustion engine with alternative power supplies, Wagoner told reporters this week at the Geneva Motor Show. He wouldn’t comment on whether General Motors Corp. might want to buy DaimlerChrysler AG. „This is a very expensive proposition. You’re going to have to see manufacturers work together in some fashion,” Wagoner said. „I guess it eventually could be in some cases mergers if the case is big enough.”

Tighter pollution requirements in the US, Europe and other governments along with the volatile costs for oil needed to make gasoline and diesel fuel are driving automakers to look for alternative fuels and engine designs to power future cars. Toyota Motor Corp. has led the development of hybrid-electric models, and GM and other automakers are developing hybrids and other ideas

Wagoner has said his Detroit automaker has already spent about €762 million ($1 billion) to develop models that use fuel cells to convert hydrogen into power and emit only water vapor and will likely spend another $1 billion before the products are ready for commercial production at the end of the decade. GM Vice Chairman Bob Lutz said in January the automaker may have to invest $500 million to create a hybrid-electric car that recharges at a household power outlet. GM also is in a $1 billion partnership with DaimlerChrysler and Bayerische Motoren Werke AG to make hybrid-electric models that don’t plug in.

„It’s real hard to draw any conclusions,” Wagoner said. „If you look at the highest level, the stakes in the industry continue to get raised.” „The cooperation within the industry is going to grow over the time, and the forms it is going to take are only limited by imagination,” he said. DaimlerChrysler CEO Dieter Zetsche repeated this week he is considering „all options” for Chrysler, including a sale.

People familiar with the talks said GM was discussing buying the unit and jointly developing products such as large sport-utility vehicles with Chrysler, which had worldwide sales of about 2.7 million last year. Zetsche March 6 confirmed talks about developing models with GM and said the outcome looked „promising.” He declined to talk about the sale of the unit. Wagoner declined to comment about potential vehicle cooperation with Chrysler.

Ford Motor Co. said February 28 that it wants to sell the Aston Martin luxury-car unit by mid-year. The automaker expects to burn through $17 billion in cash through 2009 as it tries to restore profits. Ford last year borrowed $23.4 billion, pledging automotive assets, including its headquarters building in Dearborn, Michigan, and the Ford corporate logo. Wagoner did say March 6 that GM is in „extremely” preliminary talks about a possible stake in Malaysia’s unprofitable carmaker Proton Holdings Bhd.

Volkswagen AG is also in the talks with the Malaysian government about the automaker, Volkswagen CEO Martin Winterkorn said the same day. GM is cutting $9 billion from costs this year after persuading 34,300 US union workers to leave early as part of a plan to close 12 North American locations by the end of 2008. GM lost $10.6 billion in 2005 and $3.03 billion in the first nine months of last year. The automaker has said it expects to report a Q4 2006 profit by March 16. (Bloomberg)