Detroit January 17 (Reuters) Top U.S. auto executives may allow themselves the odd celebratory drink at this year's Detroit auto show as sales recover, but they still have plenty of worries to keep them awake at night.
Demands from an increasingly restive union looking to share in the industry's rebound are familiar. But other concerns are new, results of the wrenching restructuring that sent General Motors Co and Chrysler into bankruptcy.
"The old ways and the old models are gone," GM (GM.N) Chief Executive Daniel Akerson said at an industry conference timed to coincide with the show on Tuesday. "We simply will not succeed if we continue to do business the way we always have."
Mark Reuss, the president of GM's North American operations, said the company's record initial public offering in November exposed it to another risk: that GM managers would run the business to hit short-term targets rather than work to build a loyal customer base.
"I think that keeps me up more than anything -- that we get back into this thing where we're setting quarterly targets to drive stock prices and we forget about the long-term nature of this business," he said.
'SHARING IN THE UPSIDE'?
The unionized workers whose concessions were critical to the industry's restructuring will begin negotiating new labor contracts this year and their leader, United Auto Workers President Bob King, said on Monday his members expect to share in the upside.
The union wants some form of profit-sharing at GM, Chrysler and Ford Motor Co (F.N) that would reward autoworkers for concessions that cut wages for new hires in half to $14 an hour.
GM is counting on that lower wage to allow it to make a profit on two new small cars -- the Chevy Sonic and the Buick Verano -- that it showed off at the Detroit event.
Those cars will be built in Michigan, while rival vehicles such as the Ford Fiesta are being built in Mexico.
Ford Chief Executive Alan Mulally said the second-tier UAW wage was a key part of the automaker's decision to commit to hiring 7,000 workers over the next two years.
"Part of that was to improve our competitiveness going forward," Mulally said. "This was our dream, if we could improve the fundamental competitiveness of Ford then we can make cars in the United States as well as around the world and make them profitably."
Complicating this year's negotiations is the fact that the UAW is now a major investor in GM and Chrysler. In exchange for a claim on funding for retiree healthcare, the union got an ownership stake in both companies in the 2009 bailout.
The healthcare trust fund affiliated with the UAW owns 63.5 percent of Chrysler stock -- more than double the stake owned by Italian automaker Fiat SpA (FIA.MI), the company that runs Chrysler. That trust fund is expected to be the major seller in an initial public offering of that automaker's shares in the second half of 2011. @@Page@@MIXED MESSAGE
Chrysler CEO Sergio Marchionne, who also heads Fiat, was open to the concept of profit sharing but cautious.
"I think both parties are approaching this matter with a very clear commitment to ensure the long-term survival and profitability and success," he said. "I don't think there is a doubt the UAW feels as a result of the sacrifices that we made to get everybody here, they're entitled to some participation in the future."
But he added: "We cannot institutionalize costs in the structure of Chrysler that will seed the elements of the potential failure of Chrysler or another automaker in the event of a downturn."
The Obama administration, which brokered and financed the 2009 bankruptcies that partially restructured GM and Chrysler, continues to hold sizable stakes in the two companies: 9 percent of Chrysler and 33 percent of GM.
Ron Bloom, the U.S. Treasury official charged with overseeing that investment, wouldn't comment on timing for divesting remaining shares in GM during a visit to the auto show.
"We want to exit (GM) as soon as practically possible, but we don't want to do a fire sale," he said.
Bloom also declined to comment on Chrysler's plans to pay back its debt to government. "But we are willing to keep the Treasury open really late if they want to bring us a check," he said.
THEN THERE'S TOYOTA
While Toyota Motor Corp (7203.T) (TM.N) is still dusting itself off from last year's embarrassing and costly product recall of nearly 14 million vehicles worldwide, it will not stay down for long.
This week in Detroit, the Japanese carmaker unveiled a family of Prius cars with two new additions to the lineup as it aims to build the iconic hybrid into a pillar of its sales in the United States, its biggest market.
The roomier Prius V and compact Prius C Concept were among the highlights of the Detroit show, where rivals also revealed "green" cars aimed at increasingly fuel-conscious customers.
Toyota, the world's biggest automaker, has dominated the gasoline-electric hybrid market since putting its first Prius on the road in 1997.
Not to be outdone, GM says it plans to apply the technology used in the Volt to a range of new cars, potentially including a Cadillac SRX plug-in.
A plug-in Cadillac could allow GM to extend what its executives see as a crucial lead over Toyota in what GM calls "extended range electric vehicles."
