Sept. 27 (Bloomberg) -- General Motors Corp. Chief Executive Officer Rick Wagoner has just about run out of things to fix or sell at the biggest U.S. automaker. Now he has to get more Americans to buy Chevrolet Malibus and Cadillac CTS sedans.

In reaching a new United Auto Workers contract to shed $50 billion in future medical costs, Wagoner achieved almost all of the savings he identified in 2005 as key to GM's survival. He started closing 12 North American plants, pared $9 billion in annual expenses and got 34,400 employees to take buyouts.

``It's a little bit of `put up or shut up' now that the contract is done,'' said analyst Rebecca Lindland of Global Insight Inc. ``It's not like this is going to show up right away on the quarterly balance sheet, but it does put a lot of pressure on GM to start selling cars and trucks.''

Wagoner is counting on new models such as the Saturn Vue sport-utility vehicle to stem $12.4 billion in losses in 2005 and 2006 and reverse an eight-year U.S. sales decline that spans his time as CEO. His aim is to win buyers for Detroit-based GM who have been increasingly choosing Toyota Motor Corp. brands.

While GM's domestic market share has slid to 23.6 percent through August from 28.1 percent in 2000, Toyota's has almost doubled to 16.2 percent.

`Stop the Bleeding'

Labor peace with the UAW is only one of GM's ``many hurdles,'' said IRN Inc. analyst Erich Merkle in Grand Rapids, Michigan. ``They need to shore up the market, they have to stop the bleeding. That's only going to be done through product.''

GM fell $1.18, or 3.1 percent, to $36.46 at 4:01 p.m. in New York Stock Exchange composite trading. The shares reached their lowest under Wagoner in December 2005, at $18.61.

Wagoner, 54, has singled out sales increases as pivotal, saying repeatedly that GM can't rely on savings alone to revive profit. His new-model strategy, orchestrated by Vice Chairman Bob Lutz, 75, calls for GM to generate about 40 percent of 2007 sales from models less than 18 months old. That's about double GM's total in recent years.

Wagoner also is positioning GM to be less dependent on the U.S. GM has sold a majority of its vehicles outside the U.S. since 2005, and the total is approaching 60 percent this year.

His efforts to find savings are part of a push to cut fixed costs such as labor to 25 percent of revenue by 2010 from about 30 percent now. Wagoner also has raised $21.4 billion in the past two years by selling a majority stake in the General Motors Acceptance Corp. finance unit and other assets. He has solidified his position as CEO since October 2006, when he turned back billionaire investor Kirk Kerkorian's bid to force an alliance with Renault SA and Nissan Motor Co.

Stabilize, Then Grow

Global Insight's Lindland said she expects GM to slow its sales decline next year. By 2009, sales should stabilize, and they should be rising by 2010 as a family of smaller vehicles reaches showrooms, she said.

If the increases don't come, ``it will be very disappointing,'' said Lindland, who is based in Lexington, Massachusetts.

Dealers say the new Buick Enclave, GMC Acadia and Saturn Outlook -- so-called crossover SUVs that combine car and truck features -- have been bright spots in 2007 even as GM's U.S. sales have slid 7.4 percent.

The Enclave has the second-smallest inventory among all GM vehicles, after the Pontiac Grand Prix. Dealers' supplies of the Acadia and Outlook are at least nine days shorter than GM's overall 65-day inventory, according to Autodata Corp. in Woodcliff Lake, New Jersey.

`Get Back to Selling'

``I am just happy they've got this thing settled so we can get back to selling as normal,'' said Walt Ericson, sales manager for Dunn Chevrolet-Buick in Oregon, Ohio. ``GM's just gone through so much in the last year.''

GM has said it expects the redesigned 2008 Malibu, due out in November, to help draw Toyota and Honda Motor Co. buyers while reviving interest in the Chevrolet division, which in 2006 dropped to its lowest sales total in 13 years.

The redesigned CTS also should lure more consumers, said Randy Schwarz, vehicle line executive for Cadillac.

Those models and other new vehicles are arriving just as GM and other U.S. automakers struggle with the weakest domestic car market since 1998. Toyota may overtake GM in 2007 as the global sales leader, a title the Detroit automaker has held for 76 years.

`Range of Challenges'

GM confronts ``a range of challenges unrelated to the proposed contract, including slowing U.S. light vehicle sales,'' Standard & Poor's credit analyst Robert Schulz wrote yesterday in a report. He put the automaker's debt ratings under review for a possible upgrade -- a first since 1998.

The new UAW accord may give Wagoner more maneuvering room by paring expenses as he works to improve GM's vehicle lineup.

The tentative UAW contract calls for GM to offload future medical obligations via a one-time, $35 billion payment for a retiree health-care fund, two people familiar with the plan said. Base wages also would be frozen, and new hires would earn less than current workers, the people said. GM isn't commenting until UAW members finish voting, spokesman Tony Cervone said.

GM's 8.375 percent note due July 2033 fell 1.38 cents to 89 cents on the dollar yesterday, according to Trace, the NASD's bond price reporting service. The yield rose to 9.53 percent.

Credit-default swaps on GM debt rose 12 basis points to 491 basis points, according to CMA Datavision in London. The price means it costs $491,000 to protect $10 million in bonds for five years; a decline signals improvement in the perception of credit quality.

``If I were General Motors, I would be extremely happy,'' said Michael Robinet, an analyst at CSM Worldwide Inc. in Northville, Michigan. ``This could very well be Rick Wagoner's legacy to the company.''

To contact the reporters on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net; Jeff Green in Southfield, Michigan, at jgreen16@bloomberg.net

Last Updated: September 27, 2007 16:16 EDT