Struggling General Motors Corp. is discussing the sale of its 7.9 percent stake in truck maker Isuzu Motors Ltd. to Mitsubishi Corp. and Itochu Corp., the two trading houses said Thursday.

GM, the world’s largest automaker, is in dire financial straits and is trying to raise funds to turn itself around.

Both Mitsubishi and Itochu officials said they are seriously considering purchasing GM’s Isuzu shares, but have not reached a decision.

Mitsubishi already has a 0.2 percent stake in Isuzu, while Itochu holds 0.7 percent. Isuzu is working with both firms to expand its sales network overseas.

GM and Isuzu have had a capital alliance since 1971, which both firms say has been beneficial. The two companies say joint projects and their strategic partnership will not be affected by the proposed sale.

“We understand that GM is now at a critical phase in turning around its North American business and is continually reviewing its investment portfolio to increase (its) liquidity on hand,” Isuzu said in a statement expressing support for the GM proposal.

Industry watchers took the news in stride. “As long as (GM and Isuzu) continue working together on joint projects, there will not be an immediate effect on Isuzu’s business,” said Koichi Sugimoto, an analyst at Nomura Securities Co.

In January, GM reported a $10.6 billion net loss for 2005, mainly due to falling sales in North America and enormous health-care costs for current and retired employees.

The American auto giant has announced a number of cost-cutting measures aimed at restoring its health, including cutting employee benefits and executive pay.

GM is also unloading its shares in other automakers as part of its restructuring efforts.

GM at one point owned 20 percent of Fuji Heavy Industries Ltd., the maker of Subaru cars and trucks, and 20 percent of Suzuki Motor Corp., Japan’s largest manufacturer of minicars.

Last October, the ailing U.S. automaker sold its entire stake in Fuji Heavy, with Toyota Motor Corp. buying 8.7 percent of the shares. GM also sold 17 percent of its Suzuki stake in March.

“The ailment at GM can be attributed to sluggish car sales and a high cost structure,” said Nomura’s Sugimoto, adding that GM will not raise that much cash from the stock sale.

“The move has a symbolic meaning to show that GM is doing whatever it can to revive itself.”

Unlike the alliance with Fuji Heavy, which did not bring many benefits, the GM-Isuzu alliance was regarded as useful to both companies.

Because of Isuzu’s leadership in diesel technology, GM collaborated extensively with it on development of diesel engines for commercial vehicles and pickup trucks.

“Based on our mutual trust built upon a 35-year-long partnership, we respect each other’s position and will not let (the future stock sale) hurt our business, or affect our ongoing joint projects around the world,” Isuzu said in the statement.

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