Representatives of the conservative Austrian People's Party (ÖVP) and the Social Democrats (SPÖ) met in the nation's chancellery for talks on Saturday after the failure of their discussions with a further party for a three-way coalition.

Following the failure of talks on a three-way coalition in Austria, the conservative Austrian People's Party (ÖVP) and the Social Democrats (SPÖ) want to continue one-on-one coalition talks. Austrian President Alexander Van der Bellen said Friday that both parties have announced their intent to talk about a grand coalition.

Austria's conservative Chancellor Karl Nehammer said Saturday he would step down in the "coming days" after breaking off coalition talks with the Social Democrats over disagreements on key issues. The surprise move might lead to snap polls being called in the Alpine EU member country — or the conservatives might negotiate with the far right that won national elections in September.

Austria headed on Sunday towards coalition talks led by the far-right Freedom Party (FPO) after efforts to form a centrist government without the FPO fell apart and prompted Chancellor Karl Nehammer to resign.

Austria's conservatives said Sunday they were ready to start negotiations with the far-right Freedom party (FPOe) to form a new government, a policy U-turn after coalition talks with two centrist parties failed.

Collapse underlines difficulty of forming governments in European countries where far-right on rise but parties refuse to partner with them.

Austrian Chancellor Karl Nehammer said he planned to resign in the coming days after talks between his conservative party and the Social Democrats to form a new government collapsed on Saturday, casting the nation into a political crisis.