"I can confirm that we are talking with some of the potential partners who have shown a clear interest," DaimlerChrysler chief executive Dieter Zetsche said in a speech prepared for delivery at the car maker's annual shareholder meeting on Wednesday in Berlin.

The prospect of DaimlerChrysler jettisoning its Detriot-based unit comes nine years after what is now the world's fifth bigger carmaker was formed through a $36-billion (about 27 billion euros) merger of Daimler and Chrysler.

Shedding Chrysler would also essentially take DaimlerChrysler back to where it was in 1998 when its former chief Jürgen Schrempp launched his vision to transform the Stuttgart-based company and maker of Mercedes Benz luxury cars into a Welt AG or World Inc. But what Schrempp hailed as "a marriage made in heaven" now looks like ending on the rocks.

The DaimlerChrysler share price has largely fallen, resulting in growing stockholder anger that the group's global expansion has not produced results. However, since the start of the year, the share price has climbed by more than 30 per cent on speculation that DaimlerChrysler was now prepared to sell off its Chrysler arm.

"Splitting off Chrysler appears to us as appropriate,' Unio Investment funds manager Ingo Speich told German business daily
Handelsblatt, reflecting the views of many other fund management
groups attending Wednesday's shareholders' meeting.

No details as yet

Zetsche however said Tuesday that he would not go into any detail about a possible sale of Chrysler.

"It is also true that we need to keep all options open and that I cannot disclose any details because we need to have the maximum scope for maneuver," Zetsche said. Management needed "the greatest possible flexibility so that we can identify and implement the best possible solution," he added.

Speculation has been rife that Chrysler would be put up for sale after it turned in an operating loss of 1.12 billion euros last year, despite repeated restructuring over recent years. Chrysler is suffering from high fuel prices and a consumer shift away from lucrative gasoline-guzzling trucks and large sports utility vehicles.

In mid-February, DaimlerChrysler unveiled plans to slash thousands more jobs and close two more plants at its loss-making US subsidiary in what observers believed could be a last-ditch attempt to turn the unit around.

Not too many takers

The main aim was to steer Chrysler back to profit, Zetsche said.

"This means, that after reviewing all options, we will finally decide for the option that best meets our criteria," the CEO said. "So far, I am satisfied with the process. Everything is going to plan."

A number of big institutional shareholders, such as Union Investment and SEB, appear to be losing patience and want Chrysler to put on the block as quickly as possible.

None of the other world's leading car makers appear to be interested in Chrysler, however. US daily Detroit News reported that only three candidates had submitted a firm offer by last week, private equity firms Cerberus and Blackstone, and Canadian car parts maker Magna, which is also likely to team up with an investment fund.

The newspaper said DaimlerChrysler was aiming to start exclusive
talks with a potential buyer by the end of this month, and hoped to
raise around eight billion dollars (six billion euros) from the
sale.

Outgoing boss says Chrysler could stay on

Meanwhile, DaimlerChrysler's outgoing supervisory board chief Hilmar Kopper said in a newspaper interview Wednesday that he could imagine Chrysler remaining within the group.

"There is of course a chance that Chrysler is still in the group in two years," Kopper told daily Die Welt.

Kopper, who was scheduled to retire as supervisory board chief at the AGM on Wednesday, defended the decision to merge Daimler and Chrysler in 1998.

"Many of the arguments in favor of a merger back then are still valid today," he said. And Kopper rejected suggestions that the tie-up had destroyed value.

"We created value for the shareholders. We were better than half of the DAX companies if you include the dividends," he said.

There was never any cross-subsidizing between Chrysler and the group's up-market Mercedes-Benz brand, Kopper insisted.

Sales dropped in 2007

The beginning of the year has not been good for the car company.

DaimlerChrysler announced that first-quarter sales have fallen 2.8 percent from the same time period last year. The company sold 286,800 Mercedes-Benz, Maybach and Smart-branded vehicles worldwide in the first three months of the year.

Sales dragged in Germany and western Europe, while in the US sales increased by 9.2 percent compared with a year ago. Sales also rose in Asia. The company's Smart brand sales fell more than 57 percent, a drop the company said was caused by a model changeover.