General Motors Corp. today held its last shareholder meeting of the century with decisions about its future leadership unresolved and its decades-long dominance of the U.S. auto market in serious doubt.
The company that once manufactured more than half of all cars and trucks sold in the United States has seen its share of the market shrink to 28.8 percent.
"We are not in a race to shrink the company or shrink our market coverage," Chairman John F. Smith Jr. told an audience of 125 mostly white-haired stockholders who had gathered in the ornate ballroom of the Hotel du Pont. "We are absolutely committed to profitably increasing our U.S. market share."
After the meeting, neither Smith nor G. Richard Wagoner Jr., president and chief operating officer, would say just how much of an increase in market share they expect.
Acknowledging that he hadn't guessed right in his market-share predictions for the past five years, Wagoner would only say, "I think we can grow market share."
GM's share of the U.S. car and truck market has been slowly shrinking since 1992, when the company's outside directors, faced with billions of dollars in losses, took over the company, threw out its top management and installed much of the current leadership.
GM's share of the market at the time was 33.9 percent, but since then Ford Motor Co., DaimlerChrysler AG and a host of imports have eaten away at GM's dominance.
Smith acknowledged at the start of the meeting that "1998 was a year of challenge," primarily because of a 54-day strike by the United Auto Workers union that left the company with depleted supplies of its best-selling cars and trucks. But he assured shareholders that things are getting better.
He told the shareholders that GM finished last year with the best fourth quarter in company history and that "the first quarter of this year was our most profitable single quarter ever."
Smith said the latest management reorganization in the company's automotive operations would give GM the ability to "align and leverage our resources around the world as never before."
Perhaps the biggest question left unanswered at today's meeting was future leadership. Asked about succession by shareholder gadfly Evelyn Y. Davis, Smith sidestepped the question, saying the board looked at that issue all the time. "At some point they'll make a decision," he said.
The succession question has become a silent undercurrent in the GM culture since last year, when Vice Chairman Harry J. Pearce, who helped engineer the revolt by the board's outside directors in 1992, was diagnosed with leukemia.
Although Smith is only 61, there had been reports he might retire as early as this year to make room for a newer, younger management team. GM sources said the leadership contest for Smith's job was between Pearce, 56, and Wagoner, 46. With Pearce's illness, however, the succession timetable has been thrown into limbo.
Pearce has undergone a bone marrow transplant, and GM sources said last month that it would probably be about this time next year before anyone knows for sure whether it worked. But GM officials said doctors had declared him cancer-free. Pearce, who was in Seattle today for follow-up medical examinations, did not attend the shareholder meeting.
Pearce returned to work with a somewhat curtailed schedule. He has been beset with various ailments that have limited his time at the office.
GM's stock rose 75 cents today to close at $69.12 1/2.
CAPTION: President G. Richard Wagoner Jr., left, and Chairman John F. Smith Jr. did not specify how much they hope to increase GM's market share.