General Motors and Chrysler have been involved in ongoing merger talks since September, but it looks as though further negotiations will have to be put on hold until after the Presidential election. The Bush administration shot down the automakers’ $10 billion financial aid request for the merger, putting talks on hold indefinitely.

The $10 billion loan package was critical to the GM-Chrysler merger, with the deal essentially stalled without government backing. Private investors for the merger warned GM they would only go forward with the deal if it received backing from the federal government, according to Automotive News.

The failure to secure government aid opens the door for a Nissan/Renault-Chrysler alliance. Chrysler had been in talks with Nissan/Renault about a possible partnership, with that option now looking brighter than ever. Cerberus – the parent company of Chrysler – has always viewed a Nissan/Renault alliance as Plan B if the GM merger were to fall through, with the capital management firm now strongly considering the option as it looks to cut its losses with Chrysler.

However, a GM-Chrysler merger is not completely off the table. Presidential hopeful Barack Obama has stated that if elected, he would sit down with the Big Three to discuss possible solutions to the current crisis. “My hope is if I’m elected, that I’m immediately meeting with the heads of the Big Three automakers as well as with the United Auto Workers,” Obama told NBC. “And to sit down and craft a strategy that puts us on a path for an auto industry that can compete with anybody in the world.”

While not a guarantee that Obama would offer government aid to the merger, it’s at least a good sign that he would talk to all parties involved. John McCain, on the other hand, is in support of Bush’s decision on the matter.