It's who can enter in and do a business and have a chance of serving our customers. We have an obligation: we cannot take somebody into a dealership who cannot serve our customers, who would not have thefacilities, who would not be able to service our products. So the determination of a number of dealers by any racial criterion is not a numerical consideration.

Q. Well then I take it that it is not a matter of either corporate responsibility or corporate management to develop programs that would enhance the ability of non-white groups to meet those qualifications?

SMITH: No, as I said, I think we have a deep responsibility and I think we can demonstrate it with the fact that we have worked it with a number of non-whites in all sorts of areas in developing supplier relationships, in our employment we have done something that will go a long way toward this.

General Motors has organized the MESBIC if you are familiar with it. It's a Minority Employment and Small Business Investment Company and we have invested a million dollars just to go toward helping people.

Now a million dollars is a lot of money, but more importantly we are trying to help people by working with them. Just to give somebody some money doesn't do anything for him if we don't supply the technical help, the engineering help; and we hope to organize the businesses in our plant cities so that our plant personnel and engineers can go out and actually help these people. This is a policy to come out of our board, they're the ones who authorized the million dollar investment.

Q. How long has this plan been going?

SMITH: The Secretary of Commerce approved our plan today to organize this in plant cities across the country.

Q. You viewed the prospective shareholders' committee as a potential special interests group and likely a harassment to the Board and management of General Motors. Do you feel the same way about the proposed three public interest board members or could they perhaps provide some worthwhile input?

SMITH: Any time anybody is elected to any office by a group that put them in there, I think it would be reasonable to assume that these people are going to be responsive to the demands of the group that put them there. To me that seems a fundamental axiom.

Q. If GM's record is so good then why does GM oppose any of these recommendations from the Project on Corporate Responsibility and if so which of the recommendations do they oppose?

SMITH: Specifically, we're opposing a group who has been elected to represent special interest and not the interest of the stockholders.

Transit Lobby

Q. The Project on Corporate Responsibility has made the statement: "The least General Motors can do is not to lobby against the use of government funds for public transportation." Is there any truth in this statement that GM hasn't supported public transportation?

SMITH: The best way to get at this is to look at what we consider the facts. I'd like to read one thing that goes back to 1963-and this is our position on mass transit.

Mr. John F. Schwartz, then president of General Motors, said "Certainly, it is important that in our planning for the future we seek improved mass transit. Every large city needs it; but it is a serious mistake to assume that planning for better urban transportation is a matter of choosing rail over road, public carrier over private car. Sound planning involves a proper balance, the right mix; for no one mode of travel can serve all the needs for mobility in a modern city."

Now speaking directly to the point, on March 11, 1970, Oscar A. Lundine, a vice-president of GM, testified before the subcommittee on housing, from the house committee on banking and currency, on mass transit.