Transfer expert Fabrizio Romano is reporting Chelsea have failed with a swap offer for United winger Garnacho.
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The Argentina international has agreed personal terms with Chelsea, but a deal is stalling between the two clubs due to the Blues' Profit & Sustainability concerns.
As such, Chelsea attempted to set up an exchange involving young winger Tyrique George, but United weren't interested.
George, 19, has scored three goals and provided five assists in 26 senior appearances for Chelsea.
Chelsea hope the sales of senior players Christopher Nkunku and Nicolas Jackson will help make room in their wage ceiling to bring in Garnacho.