Negotiators failed to reach agreement on a way forward for GM Europe
All-night talks in Berlin about the future of Opel and Vauxhall have broken down without reaching a decision about who should buy GM's European unit.
Officials blamed the delays on the revelation that Opel would need an extra 300m euros ($415m; £260m) in short-term funding.
The German government wanted more information from GM and the US Treasury before choosing a preferred bidder.
But one of the bidders has pulled out, leaving Fiat and Canada's Magna.
The US investor Ripplewood Holdings has withdrawn from the process.
There had also been a last-minute expression of interest from Beijing Automotive Industry Corp (BAIC), but German officials said that their focus was on Fiat and Magna.
Tim Weber, business editor, BBC News website
German politicians are furious, regardless of party affiliation. They believe that both GM and the US Treasury took them for a ride.
Berlin was ready to do a deal. The money was on the table; all decision makers were in the Chancellery.
But GM, German politicians say, ambushed the meeting by suddenly asking for another huge bridging loan. The US Treasury representative, meanwhile, is being described as "third-rate", without any authority to do a deal.
The breakdown of talks has damaged not just GM's reputation, but trust in the US government as well.
The German government expects to receive the extra information it needs by Friday, when talks will reconvene in Berlin.
But there are tight deadlines involved, with the sale of GM Europe a key part of General Motors' reorganisation plans.
GM has a 1 June deadline from the US government to either restructure its debt or declare bankruptcy.
German Economy Minister Karl-Theodor zu Guttenberg was critical of the late request for extra money.
"GM again confronted us with new figures," he said, describing the tactics as "pretty scandalous".
He also criticised the level of involvement of the US Treasury Department, describing it as "marginal, to put it politely".
It will be up to GM to decide to whom to sell its European division, but the German government is being seen as highly influential in the process because of its offer of hefty financial assistance for the eventual winner.
The German government is particularly concerned about potential job losses, especially because it is an election year, with half of GM Europe's 50,000 workers based in Germany.
Berlin is looking to set up a temporary holding company, into which it would inject 1.5bn euros to keep GM Europe operating until the next German election later this year, said Simon Dorris at Lansdowne Consulting.
The German government could then look at a full restructuring programme, which could involve loan guarantees of 7bn euros.
European ministers have called for a meeting on Friday, when they will discuss the short-term bridging loan, said Mr Dorris.
GM EUROPE BIDDERS' PLANS
Fiat: Italian carmaker; plans 10,000 job cuts in Europe; could close one of four Opel factories in Germany
Magna: Canadian-Austrian car parts group; Plans 2,500 job cuts in Germany; pledges to inject between 500m and 700m euros into Opel; 10% of the new company would be owned by Opel employees; GM would keep a 35% stake in the company; bid in connection with Russia's state-run Sberbank and Oleg Deripaska's truck firm Gaz
If an agreement cannot be reached, then GM Europe will become embroiled in GM's administration process, should the US parent company declare bankruptcy, which could happen before the 1 June US government deadline, he added.
But there has been concern from other countries that contain GM Europe factories.
The Belgian government, fearing for the future of Opel's plant in Antwerp, has called for more of a say in the choice of a preferred bidder.
British unions have criticised the UK government's level of involvement in the process.
GM Europe owns Vauxhall in the UK which employs 5,500 people and has plants at Luton in Bedfordshire and Ellesmere Port in Cheshire.