Wagoner Claims 'Absolute Clarity'

"The cuts will make GM a global leader in the industry and position it for sustained profitability, not just short-term profits," Wagoner was quoted as saying.

Despite the optimism, the threat of a labor strike at Delphi, GM's bankrupt parts supplier and former subsidiary, looms large in Detroit. GM and Delphi are in talks with the UAW in an effort to reduce hourly wages paid to workers as part of the company's restructuring plan. Delphi is seeking a judge's approval to cancel its labor contracts, while the UAW has threatened to strike in response -- an event that could cripple GM's productivity and devour its cash reserves.

As a security blanket, GM has beefed up those reserves this year by selling off stakes in some of its businesses, including its profitable finance arm, GMAC. A private equity consortium led by Cerberus Capital Management bought the unit in April in a deal that's expected to add $14 billion to GM's cash pile over the next three years.

On the product side, Wagoner was reportedly upbeat about GM's newly launched vehicles, including a line of full-size sport-utility models. He said that new models accounted for one-third of sales in the first quarter and should represent 30% of U.S. retail sales volume for 2006, according to Dow Jones. Wagoner said he expects new vehicles to account for 40% of total sales next year, compared with 20% last year.

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