The German government seemed to soften its stance on the possibility of U.S. carmaker General Motors GM.UL scrapping plans to sell Opel and keeping the European carmaker instead when GM's board meets this week.

German Deputy Economy Minister Jochen Homann said on Tuesday that GM would, however, need to present a robust business strategy if it wanted to keep Opel.

'We are keeping Opel' is not a strategy yet, he said on the sidelines of an energy conference.

He reiterated the German government's support for a deal with Canadian auto parts group Magna (MGa.TO) and its Russian partner Sberbank (SBER03.MM)

We have laid the groundwork in the direction of Magna, Homann said.

GM's board of directors is expected to meet on Tuesday and Wednesday to discuss its plans for Opel, and Berlin has put pressure on GM to seal the carmaker's fate this week, having deferred a decision several times already.

The German government has come out strongly in favor of Magna as a buyer, while GM's management has indicated a preference for rival bidder RHJ (RHJI.BR). Sources have also told Reuters that some board members want to keep Opel instead.

German newspaper Handelsblatt reported that GM may defer a decision again and wait until after a German federal election on September 27. Homann said he hoped for a decision by Wednesday.

Talks to sell Opel have lasted for months and have become a political hot potato ahead of the elections because of the state support involved and the thousands of job cuts expected to follow any sale.

German Chancellor Angela Merkel and German states think Magna's expertise can save more of the 25,000 Opel jobs in Germany.

(Reporting by Vera Eckert; Writing by Maria Sheahan)

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