GM CEO sees modest U.S. auto sale recovery

The U.S. car market should see a modest recovery in 2010, with sales possibly reaching between 11.5 million and 12 million vehicles, General Motors Co Chief Executive Fritz Henderson said on Thursday.

2010 will be a modest improvement, Henderson told reporters at a business roundtable in Orlando, Florida.

Henderson said the U.S. market this year was on track to reach 10 million to 10.5 million unit sales and on track for a continued gradual recovery.

In a subsequent interview with CNBC, Henderson said he expected that 2011 sales would rise to around 13 million units, near the level of sales in 2008 before the sharp downturn began.

The GM executive repeated a forecast that General Motors, which is undergoing restructuring coming out of bankruptcy, expected to achieve its break-even point for the U.S. market by next year.

Break even ... would be a 10 million-unit market and an 18 percent market share. We're going to achieve that goal. We don't need the market to be 14 million or 15 million (units) to make money, Henderson said.

We have to win in the U.S., he said, responding to a question about whether his own job might be on the line if GM did not show a measurable improvement in the final quarter of this year.

Speaking from Orlando on CNBC, Henderson said he sees a more gradual increase in U.S. auto sales than his counterpart at Ford Motor Co , Alan Mulally, who earlier this week said 2011 U.S. sales could reach 14.5 million units.

Henderson said a figure of near 13 million to 13.5 million units would be closer to where we would see it at this point.

As for September sales, Henderson said the seasonally adjusted annualized rate would be slightly below or slightly above 9 million units. Sales at that level would be near the lowest levels of the year.

Earlier this month, GM launched a May the Best Car Win campaign including a 60-day money-back guarantee that seeks to convince North American consumers that its cars are not inferior to foreign imports.

CHINA GROWTH RATE A SURPRISE

Henderson also said China would very much be a priority market for the company this year, adding, not just for GM.

The China market this year will be over 11 million units, he said, adding that this compared with just 2.3 million in 2001.

He recalled that back in 2002 he had predicted the Chinese car market would outstrip the U.S. market in a decade, but said the Chinese market had grown faster than he had expected.

GM said in July that it expected more than 10 percent growth in its vehicle sales this year in China, its second-biggest market after the United States.

Henderson said he was thankful that the company had moved to increase capacity in China in the early 2000s, despite criticism at the time that this was overly aggressive.

Referring to GM's plans to sell a majority stake in Opel to a Russian-backed consortium led by Magna International , Henderson said he was negotiating to have the necessary agreements in place by early October and was confident this could be done.

(Additional reporting by Bernie Woodall; Editing by Pascal Fletcher and Matthew Lewis)