DETROIT – Grace Lieblein, the top executive for General Motors Co. in Mexico, expresses optimism about the region’s struggling market in 2011 and says she wants to steer the auto maker away from stacking the deal to selling the wheels.

“About 50% of our sales are smaller cars, and there are probably more brands in Mexico now than I have ever seen, so it’s very competitive and price does become a factor,” she tells Ward’s on the sidelines of the recent North American International Auto Show here.

More than 30 brands crowd the Mexican market, which according to Ward’s data averaged roughly 1 million light-vehicle sales annually over the last decade until the global meltdown in 2009.

But rather than trying to win car buyers over with special deals, Lieblein says the auto maker is concentrating on selling the product. “We’ve got great products in Mexico, many of them made in Mexico, so we’re transforming the philosophy towards that.”

At the same time, she admits Mexican consumers want more bang for their buck these days and value is very important. “They look at the lifecycle cost of the vehicle, whether that is fuel efficiency or cost of maintenance. That tends to be a really big deal for Mexico.”

Lieblein is a former global vehicle chief engineer for front-wheel-drive trucks who parachuted into GM Mexico as president and managing director at the bottom of its sales and production swoon in January 2009 and says the company’s fortunes now are looking up.

GM wrestled its way to 19% of the Mexican market in 2010, Ward’s data shows, good for the No.2 position behind Nissan Motor Co. Ltd.’s leading 23.2% share. Volkswagen AG occupies the No.3 spot with 15.8%.

After sales bottomed out in 2009 at 752,552 units, the Mexican market mounted an 8.8% recovery in 2010 to 818,785.

GM’s sales improved 12.5% to 155,580 units, and its Chevrolet brand gained more than a point of market share with 141,603 deliveries, up 15.5%. The locally made Chevy Aveo became the country’s top-seller in its segment for 2010.

“We’re in the process of recovering still,” she assures. “Obviously, 2009 was a crisis year for all of us around the world.”

But Mexico, whose economy is tied tightly to the U.S., also suffered through an influenza epidemic in 2009, on top of its economic meltdown. A government scrappage program provided some support, but ultimately was hindered by a lack of funding.

Lieblein is optimistic. “The growth we saw last year was higher than expected, and throughout the year we continued to increase our forecast,” she says. “We continue to see growth for 2011 and probably at a somewhat higher rate.”

Recently publicized violence among drug traffickers has affected sales in the pickup and luxury segments, Lieblein says. Pickups are a big target of thieves, and luxury vehicles attract unwanted attention.

“People are becoming a little more hesitant about being in a big, flashy, expensive vehicle,” she says. “It’s not huge, but we definitely have seen an impact.”

The violence, which generally has been concentrated in border towns far north of GM’s Mexican facilities, has not affected the auto maker’s production schedule.

Lieblein sees a big opportunity for GM to differentiate itself in the market at the point of sale, a key initiative for her heading into the New Year.

“We’re working closely with the dealers, and within the company, to make sure when a customer comes in – I don’t care if they are in Tijuana or Mexico City or Cancun – that they have an outstanding experience, whether they are buying their car or getting it serviced,” she says, echoing similar efforts under way by GM in the U.S. this year.

More broadly, Lieblein plans to continue working with the Mexican government to spur sales, perhaps taking a page from GM Brazil’s successful playbook. In 2009, the Brazilian market ran against trend to post record sales. Lieblein cites close work between its auto industry and the federal government.

Low interest rates and tax breaks for small-displacement engines and flex-fuel vehicles combined with a slew of new-product introductions from auto makers to sustain sales and production in Brazil during that crisis year.

Mexico’s new-vehicle taxes particularly are onerous on auto makers, Lieblein says. “We worked with the government (last year) to get some of those taxes eliminated or reduced with good success. We plan to continue that again this year.”

At the same time, Mexico is entering a period of political uncertainty this year as the run-up to a presidential changeover in 2012 begins, and vehicle sales could be affected, she says. “That can always swing one way or the other.”

Mexico’s production outlook for 2011 hinges on a recovery in the U.S. market, which swung to 11.5 million light-vehicle deliveries in 2010 from 10.4 million in 2009. Experts see as many as 2 million more sales this year.

In 2010, GM Mexico produced 559,437 vehicles, up 59.6% from 2009.

GM Mexico also has been trying to diversify its export markets over the last few years, so continued momentum in South America also bodes well for Lieblein’s production slate.

“Those countries are doing well – Brazil, Argentina – they’ve done really well with the Aveo,” she says. “We have a lot of synergies with South America. I’m not going to predict a number, but I definitely see continued growth in export.”

But the Mexican market still commands 60% of everything GM builds there, and, longer term, Lieblein believes the market could rise as high as 2 million units. She’s not alone, evidenced by the recent influx of nameplates.

“Mexico has 44 free-trade agreements, so it is a very open market,” Lieblein says. “We don’t have very strong restrictions on producing locally or installing a percentage of local content, like other countries. So I think we will continue to see different companies look at Mexico as a great opportunity. They see it as another developing market.”

Lieblein reports to GM North America President Mark Reuss and says her unit’s role within the auto maker’s universe changed little with the parent’s restructuring.

However, she does operate with greater authority these days, an environment GM hoped to achieve for its regional leaders with its post-bankruptcy management strategy.

“I feel a lot more autonomy in my position to do what I need to do to be successful in my country and to run the business,” Lieblin says. “I like it. It’s refreshing.”

jamend@wardsauto.com