Washington - The US government is weighing taking an equity stake in General Motors Corp, Bloomberg financial news reported Tuesday citing people familiar with the negotiations. The largest US carmaker faces a June 1 government deadline to further restructure or lose government support designed to keep the industry afloat through the economic crisis and declining demand for US-made cars.

The US government has already given GM 13.5 billion dollars in loans and the company has said it could need 20 billion dollars more. US President Barack Obama had demanded drastic changes at GM and competitor Chrysler LLC.

The US government late last month forced out long-time GM chief executive Rick Wagoner, who was replaced by the company's president Fritz Henderson. Henderson has said bankruptcy remains an option in the GM's restructuring.

In an interview with the Wall Street Journal published Tuesday, GM's interim chairman Kent Kresa said the company would welcome a government equity stake in place of debt owed to Washington.

"Certainly, that would be helpful," he told the newspaper.

GM has lost some 80 billion dollars over the last four years. But the company has been brought to the brink only in the last few months as the US recession has driven US car sales to 25-year lows.(dpa)