Talks on forming another “grand coalition” government in Germany are unlikely to fully start until next year as the Social Democratic party (SPD) continues to weigh up the risks of working again with Angela Merkel.

Merkel’s chances of a fourth term as chancellor were thrown into doubt this month when talks about a three-way “Jamaica coalition” between her Christian Democratic Union (CDU), the Free Democrats and the Greens collapsed.

At the end of last week the SPD leader, Martin Schulz, budged from his previous position and indicated he was open to exploring the possibility of a re-run of the centrist coalition between Germany’s two largest parties that has governed the country for the last four years.

But he continues to face pressure from MPs and party members who worry that another grand coalition could drive the SPD into an existential crisis.

On Monday Schulz said he was prepared to walk out of talks if other parties did not show enough flexibility. He said the SPD would rely “on the strength of its arguments, not showmanship in the media”.

Merkel reiterated her scepticism about the possibility of a minority government, stating that “the formation of a stable government is a value in itself”.

Schulz and Merkel will visit the German president, Frank-Walter Steinmeier, for a first exploratory meeting on Thursday.

Julia Klöckner, a CDU vice-chair, said coalition talks were unlikely to begin until the new year, more than three months after the federal elections in which there were significant losses for the CDU and SPD and gains for smaller parties.

Delegates on the left wing of the SPD are encouraging Schulz to offer Merkel his support for a minority government instead of being drawn into a formal coalition agreement.

“The SPD should only open itself up to another coalition with Merkel if it wants to commit suicide,” said Marco Bülow, a Dortmund MP. “We’ve tried it twice, and each time we ended up with our face in the mud. A third time and we’d be like lemmings.”

Bülow suggested his party could instead lend a CDU-Green minority government support on passing a budget, and in return demand infrastructure investments, higher pensions and a U-turn on the outgoing finance minister Wolfgang Schäuble’s fixation on balancing the books.

SPD leftwingers spot a parallel between the current political situation and the twilight years of Helmut Kohl’s chancellorship. Under Oskar Lafontaine’s leadership in the late 1990s, the SPD was able to raise its profile and influence government decision-making in opposition by blocking CDU-led tax reforms.

But while a grand coalition remains unpopular with the SPD base and has its delegates split down the middle, support is likely to increase once coalition talks gain momentum.

Advocates of another coalition between the country’s biggest parties argue that only a stable German government would be able to meet expectations of leadership and reform from elsewhere in the European Union.

For the last two months German politics has been unable to react to the French president Emmanuel Macron’s vision for “profound” changes in a post-Brexit EU, laid out days after Germany’s federal election in September.

Macron’s proposals included shoring up the 19-member eurozone with a finance minister, budget and parliament – ideas dependent on the backing of Berlin.

Schulz indicated on Monday that if there was an argument that could convince his party to form part of Germany’s next government, it was the future of the EU. He said the Greek prime minister, Alexis Tsipras, had encouraged him to open himself up to coalition talks.

By that same logic, the prize Schulz might try to extract from Merkel in exchange for his party engaging in government-building could end up being the influential and much-coveted post in the German finance ministry.