General Motors Corp. yesterday asked the government to throw out a preliminary finding that as many as 5.3 million midsize GM cars and related models, built from 1978 through 1980, may have a "catastrophic" defect that could lead to injury and possible death.

In testimony before the National Highway Traffic Safety Administration, GM officials and consultants said NHTSA's finding was unwarranted and "should be reversed." They contended that, statistically, only 16 of the 5.3 million cars can be expected to be involved in the future in an accident causing injury.

NHTSA on April 1 issued an "initial determination" that a safety-related defect existed in the rear-wheel assemblies on 1978, 1979 and 1980 midsize GM passenger cars, station wagons and "sedan pickups" (passenger cars with light-truck flatbeds, except in the case of the Chevy Blazer, which has a station wagon/van design).

NHTSA said the alleged defect involves an improperly manufactured part, called an end button, which could weaken and lead to the loss of a "C-lock" retaining clip. Loss of the clip could cause complete separation of the rear-axle and wheel assembly--a possibly "catastrophic event" that could result in "loss of control, accidents, injuries, deaths or property damage," NHTSA said.

NHTSA said it had received reports of 64 accidents, 11 of them involving injuries, allegedly caused by the suspected defect.

The agency's announcement was accompanied by a dramatic film, broadcast on national television, showing the rear-wheel assembly falling from a 1979 GM Malibu station wagon.

The filmed event was staged--a legitimate practice used to demonstrate the possible consequences of a defect. But NHTSA failed to identify the staged breakdown as a simulation at the time it was presented.

GM officials said yesterday that the film "generated . . . much needless anxiety among our customers." But they said their major objections were to NHTSA's interpretation of data used to issue the defect ruling.

In summary, GM argued that:

Only three in 1 million of the cars cited by NHTSA had a chance of experiencing a rear-axle related failure that could cause an accident with injuries.

About 16 of the suspected 5.3 million cars will be involved in an injury-producing accident attributable to axle shaft separation "over all the years those cars will remain on the highways."

The accidents most likely would involve minor injuries.

The projected rate of axle separation in the GM cars cited by NHTSA "is as good or better than that of all manufactured vehicles operating in this country."

In light of that projected rate, NHTSA is holding GM to an unreasonable standard--"a zero defects manufacturing output, which is an impossible goal."

GM would have to spend $125 million to recall cars with the suspected defect. Customers would spend an estimated total of $120.6 million--gas, oil, lost work time, etc.--to deliver and pick up their cars in the recall campaign.

There was no cross-examination of GM witnesses, nor was there any rebuttal from NHTSA officials.

The agency will review GM's arguments and research and conduct additional tests before making a final determination whether to order a recall.