Berlusconi says no auto aid for now

TRIESTE, Italy (AP) - Italian Premier Silvio Berlusconi and German Chancellor Angela Merkel are taking a wait-and-see posture on aid to the auto industries that power both economies, while closely watching moves in the United States, the leaders said following a summit in the northern port of Trieste on Tuesday.

Automakers have been calling for aid to help them weather the slide in demand with the global financial crisis - while the United States considers a bailout for Detroit's General Motors Corp., Ford Motor Co. and Chrysler LLC.

But Berlusconi said he did not think aid to the Italian auto industry was necessary at the moment.

"For now, we think that we shouldn't intervene in that direction. On the other hand, we don't exclude anything, let's see how the market reacts in the future. But for the current situation, no interventions are foreseen," Berlusconi told a news conference.

Fiat Group Spa, Italy's largest industrial concern, has announced production slowdowns as demand for autos has dropped under the impact of the global financial slowdown.

Merkel also is putting off a decision on aid, after having met with Adam Opel GmbH officials on Monday night.

The German leader said at a news conference that the Opel situation was unique, because it is a wholly-owned subsidiary of the troubled U.S. automaker General Motors Corp., which is seeking U.S. government help to avoid bankruptcy.

"And GM's future cannot be foreseen," Merkel said.

Merkel said she will watch with attention any moves in the United States.

"We will wait to see how America supports its auto industry. We don't want our industry to be damaged," Merkel said.

The two leaders also discussed Italy's upcoming presidency of the Group of Eight. Berlusconi said he would like to expand the group when discussing issues of common concern to include non-members such as China, India, Brazil, Mexico and South Africa and when appropriate also the full Group of 20 nations that met this past weekend in Washington to discuss the global financial crisis.

Berlusconi greeted his guest with a burst of playfulness, hiding behind the base of a column as Merkel approached their meeting place, then popping out to surprise her. Video of the encounter broadcast on Italian television showed Merkel whipping around to look at what was happening, then laughing when she saw Berlusconi. The two leaders embraced.

Italian news reports said Berlusconi called out "cuckoo" when he jumped out, but that wasn't audible in the video.