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Despite a national search begun after Chairman John Smale insisted on considering outsiders, General Motors Corp. is leaning toward an insider candidate for its top marketing position.

People close to the selection team say the odds-on co-favorites are two VPs who are general managers of vehicle divisions: Edward Mertz, the head of Buick, and John Middlebrook, the top man at Pontiac.

GM has been reviewing candidates since J. Michael Losh was promoted to exec VP-chief financial officer on July 1, leaving open his former position as VP and group executive in charge of sales, service and marketing for North American Operations.

From the start, GM officials said they would consider both inside and outside candidates, fueling speculation the tradition-bound automaker would bring in someone with marketing experience in non-automotive areas.

But now, GM's search committee "isn't looking for a marketing guru so much as it's looking for a nuts-and-bolts operations-type person," said one official familiar with the committee's workings.

Mr. Mertz, 57, worked up through GM's engineering ranks before taking over Buick in 1986. He steered Buick to clarify its position as a premium U.S. product.

Mr. Middlebrook, 53, held several sales and marketing positions at GM before becoming Pontiac general manager in 1989. This year, he led the division to adopt a brand management system resembling Procter & Gamble Co.'s.

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