The German government has delayed a vote which was expected to rule out federal aid for General Motors' European unit Opel, giving Opel's supporters a few more days to lobby Berlin to change its mind.

The German rescue fund's four-person steering committee, which includes Chancellor Angela Merkel's chief economic advisor Jens Weidmann, pushed back a meeting scheduled for 1200 GMT on Friday to an unspecified date next week.

Calling off the meeting prolongs an 18-month long waiting game for the loss-making European brand, which first sought help from German state and federal governments in November 2008.

All parties had originally hoped a final decision would have been made by the end of May, but many deadlines have come and gone during a saga that dominated headlines ahead of general elections last September.

All signs out of Berlin recently had pointed to a decision against extending aid, increasing fears among the workforce and the four German regional states home to manufacturing plants.

Opel's labor leaders stuck to their plan to hold a demonstration together with powerful German union leader Berthold Huber in front of the Frankfurt stock exchange on Monday to pressure Berlin to guarantee 90 percent of a 1.3 billion euro loan the carmaker applied for.

The carmaker argues that backstopping its loan would only partly help to restore an even playing field to the European auto industry, since other rivals were able to borrow outright billions from the European Investment Bank last year -- something it never could, since it lacks a credit rating.

CHANCELLOR LAST HOPE

Compared to the rescue package for Greece, there is a considerably lower likelihood that Opel would ever need to actually draw on taxpayer funds, deputy chairman and works council boss Klaus Franz told Reuters on Friday.

Unions at Opel believe Germany would attach enough strings to its support, better ensuring job security for the 25,000 workers here than were GM to finance the turnaround plan at its European unit on its own.

Germany's obligations to support struggling euro zone governments like Greece while at the same time mapping out its own plan for fiscal consolidation has stretched Berlin's finances substantially, however, reducing the chance for a profitable GM to receive aid for Opel.

Economics Minister Rainer Bruederle, a liberal who eschews state intervention in general and has long argued against guaranteeing loans for Opel, said on Tuesday that a panel of business experts advising the rescue fund was very critical of extending support.

The state premier of Thuringia, home to Opel's Eisenach plant and lately the most aggressive supporter of state aid, called on Merkel to intervene in favor of a guarantee.

The chancellor is not entirely without influence, Christine Lieberknecht told MDR state radio station.

(Additional reporting by Jan Schwartz in Hamburg; Editing by Jon Loades-Carter)

($1=.8205 Euro)

Germany