Is General Motors a buy? Perhaps, if you think management at the world's largest car maker can swim against the tide of its own 100 years of history.

Broad strategic changes have been planned for General Motors, the world's largest automobile maker, GM Chairman and CEO Richard Wagoner tells investors.

Speaking recently at a news conference prior to the annual shareholder's meeting, Wagoner cited "recent developments on the global oil scene [that] have made it necessary for [GM] to take additional actions."

Back to the future for GM: Smaller cars. The auto giant is betting high oil and tight pocketbooks will be the norm for some time to come.

And, it's betting that foreign buyers — already small car consumers — will figure more highly into the bottom line.

Of major concern to Wagoner, "is the unprecedented rise in oil prices which have more than doubled over the past 12 months alone and are viewed by most experts as a part of long-term trend toward higher energy costs — a structural change, not just a cyclical change."

Among the actions Wagoner outlined that he says would position GM for sustainable profitability were the closing of four pickup truck and SUV plants; a sale or redesign of the gas- guzzling Hummer, and new, accelerated focus on smaller, more gas-efficient cars and crossover autos.

GM will save some $1 billion per year as a result of the plant closings, and paired with previous cost-cutting initiatives could save the firm some $15 billion over 2005 costs by 2011. This would improve GM's bottom line considerably if the savings materialize as forecast.

To generate revenue and new buyers, GM will introduce a mix of new energy-efficient models.

"Eighteen of our next new 19 product launches in the U.S. will be cars or crossovers," Wagoner says.

Accordingly, the GM board of directors approved an all-new, next-generation Chevrolet compact car program.

"This car will represent the first U.S. application of our global architecture strategy, an initiative we undertook several years ago, and will pay major dividends as we fully leverage our expansive car development capability in Europe, Korea and other locations to accelerate the shift in our U.S. product portfolio," says Wagoner.

The new compact will be pure Chevrolet in design and performance, will be better equipped than today's Chevrolet, and will achieve benchmark safety and quality levels, Wagoner says.

"Most important, [the car] will have a 1.4 liter turbo engine...which when mated with a manual transmission will offer a nine-mile-per-gallon fuel economy improvement over Chevy's entry in this segment today."

On the plus side of the GM ledger, says Wagoner, was the auto maker's growing business in the overseas market, notably China, Russia and South America.

Barron's, for one, enthusiastically recommends buying GM stock in a recent cover story. GM share price has been down substantially from its 52-week high of $43.20.

In a recent cover article, Barron's analyzed the problems and potential of the century-old firm. It pointed to the coming changes recently announced which may — or may not — return the firm to profitability.

Barron's sees up to a year and a half of pain ahead, then a possible payoff for patient GM investors.