(Adds industry outlook)
NEW YORK, Oct 15 (Reuters) - General Motors Co’s [GM.UL] turnaround plan assumes it can maintain slightly more than 19 percent of the U.S. market, board member Stephen Girsky said on Thursday.
“The public plan is 19 percent and change. That is what everything is being based on,” Girsky said during a panel discussion at a conference at Columbia Business School.
Girsky, who joined GM’s 13-member board as a representative of the United Auto Workers union when the automaker emerged from bankruptcy in July, was responding to a question on what GM’s market share would be in three years.
The comments marked the first time a GM director addressed the question of market share after the company took $50 billion of emergency U.S. government support.
GM had 19.5 percent of the U.S. auto market in the third quarter and a restructuring plan it announced in May was based on the automaker maintaining an 18.5 percent share in 2009.
The automaker’s share of the U.S. market has eroded steadily for decades. GM held almost 29 percent of the U.S. market in 2002.
Girsky, an independent consultant and former Morgan Stanley analyst who was tapped as an adviser by both the company and the UAW, said there is too much capital tied up in the automobile industry.
Automakers borrow money from their dealers, their suppliers, their employees and their retirees, he said. Meanwhile, the costs of closing down capacity are high and the cost of entry for new competition is going down.
When asked about the success of Carlos Ghosn, who was credited with reviving Nissan Motor Co Ltd (7201.T) after its deal with Renault SA (RENA.PA), Girsky noted that one element of his success has been that he was able to empower the so- called “car guys.”
“I do think there are car guys at GM,” Girsky said. “It’s about empowering them.”
Looking 10 or 20 years into the future as electric cars are more prevalent, Girsky said he could see an industry where the carmakers assemble the car, but the consumer focuses on branded parts inside.
The buying decision could be based on who has the best battery, or who has the best designers, he said.
General Motors has in the past said it expected 2010 U.S. sales of 11.5 million vehicles, while other industry outlooks have gone as high as 12 million or 13 million.
Experts on the two speaker panels at the conference made some U.S. sales forecasts.
Thomas McLarty, a former White House Chief of Staff whose family has owned car dealerships for decades, said he expects vehicle sales of 12 million to 15 million in the next five years.
Stephen Toy, a managing director at WL Ross & Co, the investment firm led by Wilbur Ross that has invested in the car parts sector, believed sales would be in the 13 million or 14 million range in the “medium term.”
Al Koch, a managing director at AlixPartners who is heading the Motors Liquidation Company, or “Old GM,” said he thought capacity in the United States will probably be in balance at about 12 million or 13 million.
Through September, U.S. auto industry sales were down 27.4 percent from a year earlier and are expected be above 10 million for 2009. (Reporting by Caroline Humer; writing by Kevin Krolicki; editing by Maureen Bavdek, Steve Orlofsky and Andre Grenon)