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The United Auto Workers union wants to see German automaker Daimler hold on to its struggling Chrysler unit, the president of the union said on Tuesday, adding that he was "not ready to concede" a spin-off was inevitable.

UAW President Ron Gettelfinger, who sits on DaimlerChrysler AG's (DCXGn.DE: Quote, Profile, Research) supervisory board, said the union had been surprised by the February announcement that Daimler was open to a sale of Chrysler Group, which represents the Jeep, Dodge and Chrysler brands.

"Our initial reaction was like everybody else. It caught us off guard. It took us by surprise," Gettelfinger told radio station WJR in an interview. "Certainly we want to keep DaimlerChrysler. We want to keep the Chrysler Group in that family. That's our objective."

Gettelfinger, who will lead the UAW in a crucial round of contract talks with the Detroit-based automakers set to begin this summer, said that a sale of Chrysler was not inevitable.

"I've been around the process long enough to know that I'm not ready to concede that the Chrysler Group is going to come out of DaimlerChrysler," Gettelfinger said in the WJR interview.

If Chrysler is sold, Gettelfinger said the UAW would prefer to see it end up with an automotive buyer rather than a private equity fund.

"It does make sense that it would stay in the auto group. I think everybody would prefer that," he said.

General Motors Corp (GM.N: Quote, Profile, Research) and a number of private equity firms, including Cerberus Capital Management and The Blackstone Group, have emerged as potential bidders for Chrysler.

DaimlerChrysler executives have said they will not have a traditional auction for Chrysler and will share financial information on the automaker selectively.

Chrysler has announced plans to cut a total of 13,000 jobs, or about 16 percent of its work force, in a bid to return to return to profitability by 2008.

Gettelfinger declined to comment on the upcoming contract talks with Chrysler, GM and Ford Motor Co.(F.N: Quote, Profile, Research)

"I've said this before. Negotiation is very difficult regardless of the circumstances that exist," he said.