General Motors has had talks with smaller rival Chrysler about a merger that would combine the No.1 and No.3 American automakers at a time when both are struggling to cut costs and shore up cash, according to a source briefed on the matter.

Separately, Ford Motor Company, plans to sell its shares from its controlling stake in Japan's Mazda Motor, a second source said.

Finally, Barron's reported that GM was preparing to approach the U.S. Federal Reserve about borrowing money from the central bank's discount window because of the logjam in credit markets that has shut it out of other kinds of borrowing.

The moves come as all three Detroit-based automakers are struggling with a plunge in US sales to 15-year lows and facing tough questions from investors and creditors about whether they have the cash to ride out a deepening downturn.

Representatives of Cerberus Capital Management, the private equity firm that owns an 80.1-per cent stake in Chrysler, were not immediately available for comment.

Chrysler and GM declined comment. Ford representatives could also not be immediately reached.

Cerberus is also in exploratory talks with other parties, including Renault-Nissan to sell Chrysler, the source said.

But any deal would hinge on the completion of the sale of Daimler AG's remaining 19.9-percent stake in Chrysler to Cerberus, the source said. Cerberus last month said it had approached Daimler to buy that remaining stake.-Reuters