The U.S. government should consider a proposed merger between Chrysler LLC and Italy's Fiat SpA if it is the only way for the distressed Detroit automaker to survive, a senator said on Thursday.

Bob Corker, a Tennessee Republican, said in an interview with Reuters that there is little hope Chrysler can reorganize as a stand-alone company, despite its contention that it can with additional government capital, and those advocating consolidation should realize that a tie-up might involve foreign ownership.

What is it that can happen out there that creates the highest probability they can pay back (bailout funds)? Corker asked. If the merger with Fiat is it, maybe that's something we ought to consider.

The government would have to approve any merger. There have been few details of the proposal, which was announced last month.

Corker said he has met with Fiat representatives to discuss the plan in which Fiat would take a 35 percent stake in Chrysler in exchange for access to technology and overseas markets.

Chrysler is 80 percent owned by Cerberus Capital Management.

Chrysler submitted restructuring plans with the Obama administration on Tuesday that outlined its plans to survive as a stand-alone entity.

The automaker also repeated it was pursuing an alliance with Fiat so long as it could be made viable but provided little detail.

Chrysler sought $5 billion in new government aid in its restructuring plan after receiving $4 billion in bailout funds in December. (Reporting by John Crawley)

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