General Motors Corp., chairman Thomas A. Murphy launched a vigorous attack on the federal government at the auto maker's annual meeting here today.

"Deafness on the Potomac concersn me as a businessman and as an American," he said.

"I can cite no more startling instance of unresponsive government than this: We are only three months away from the start of production of our 1978 models, yet . . . no manufacturer can (legally) build and sell even one 1978-model car," he said.

Murphy call it "inconceivable) that the government would allow the auto industry to shut down.

"The economic and personal trauma brought on by the closing of hundreds of plants and the lay off of millions of workers is simply unthinkable," he said.

Despite deliver of that dire message by testimony, letter, speech and in person, "Nothing has happened except the continued exercises of costly bureaucratic brinkmanship," he said.

Murphy's forceful attack followed by a week a similar blast from Henry Ford II, chairman for Ford Motor Co., at that firm's annual meeting.

The highlight of the session, which was attended by more than 700 stockholders, was the announcement of a substantial increase of the company's small car production.

Murphy said the number of Chevrolet Chevettes produced will be doubled beginning next month when a second shift is put on the Wilmington, Del. assembly.

Production of the subcompact Chevrolet Monza and related cars will be increased next fall when a second shift is added at the Lordstown, Ohio assembly plant.

Murphy reitterated his support for the President's energy program, but took exception to the tax-rebate proposal for new cars. He termed it "unnecessary, unfair and unwise."

The session was interrupted several times by those opposing the company's continued operations in Chile and by critics of the firm's engine switch and settlement plan.

About 50 pickets clustered outside the Fisher Building where the meeting was held, protesting the Chilean involvement.

Murphy also defended the settlement offer to the 87,000 owners of cars with Chevrolet engines, rather than the other GM-models specified at the time of sale. He said 90 per cent of the 24,000 who have responded to the company's offer so far have chosen a special three-year warranty on the power train rather than an exchange of the car. The settlement will cost GM $12 million, he said.

The earlier estimate of 127,000 car owners affected by the switch included cars in dealer inventories where the engine's origin was made clear before sale, a GM spokesman explained.

The Federal Trade Commission launched an investigation into the engine switch incident earlier this month following a flood of individual and consumer group complaints GM is being sued by the attorneys general of all but two states who refuse to accept the settlement offered.