General Motors Corp. said Thursday that it's basing its turnaround plan on the assumption that the auto industry will sell 10.5 million cars and trucks in the U.S. this year, a 1.5 million drop from the expectation it shared with Congress last month.

While asking lawmakers for $18 billion in loans, the Detroit automaker said it expected industrywide sales of about 12 million for 2009, with 10.5 million seen as a worst-case scenario.

The Treasury Department allocated $13.4 billion in loans to GM last month, and the company must submit a plan to show the Treasury Department that it is cutting enough costs to become viable, or the government can call back the loans March 31.

GM said it was adopting the lower estimate in its planning because of continued uncertainty over when the market for new cars might recover.

"What we're trying to do here is be very conservative about our assumptions," GM President and Chief Operating Officer Fritz Henderson said at a Deutsche Bank analysts conference in Detroit that was webcast.

U.S. auto sales fell to 13.2 million in 2008, down 18 percent from a year earlier as poor consumer confidence and tight credit kept buyers away. Many analysts have been predicting sales of 10.5 million to 11.5 million in 2009.

GM has said it will become profitable again once sales return to between 12.5 million and 13 million.

GM received $4 billion from the government at the end of December. It is supposed to get another $5.4 billion Friday and could get the remaining $4 billion in February if Congress releases more money from its $700 billion financial bailout.

Earlier this week, Henderson told reporters that GM's worst-case scenario would require more aid than that.

The company on Thursday also cut its industry sales expectations for the next three years. Henderson said that while sales will increase each year, they still won't be back to where they were in the eight- or nine-year period leading up to 2006.

U.S. auto sales peaked at 17.4 million units in 2000, according to Wards AutoInfoBank.

Globally, GM said it's planning for industrywide sales in 2009 to total 57.5 million cars and trucks, down from 67.1 million in 2008.

GM said its lower sales expectations will force it to make hard decisions that will result in a stronger viability plan and improve the company's position for long-term growth. The company said it will continue revise its plans as market conditions change.

"We are on track to accomplish the requirements of the viability plan," Chief Executive Rick Wagoner said in a written statement. "We know we have a lot of work in front of us, but we are already working closely with many key stakeholders."

Those stakeholders include the United Auto Workers union, which must make concessions to reduce labor costs under the federal loan terms. GM must also get bondholders to agree to trade a large portion of their debt for stock in the company.