GM Chairman and CEO, Ed Whitacre, announced at the end of April that GM had repaid, in full, its US and Canadian government loans totalling $8.1 billion USD – five years ahead of the stipulated timeline. “GM is able to repay the taxpayers in full, with interest, ahead of schedule, because more customers are buying vehicles like the Chevrolet Malibu and Buick LaCrosse we build here in Fairfax,” said Whitacre at a ceremony to highlight further investment at GM’s Kansas plant, which would enable it to produce the next generation of these popular vehicles.

Whitacre neglected to point out, however, that the loans were repaid using government funds held in case of emergency – should GM’s condition worsen. Of course, the fact these funds are no longer necessary, and GM has been able to repay its loans five years ahead of schedule does indicate that the recovery is now well underway – not to mention the fact that the pace of recovery has far exceeded expectations. So much so that GM aims to post its first quarterly profit in years in Q2 2010. This should help US taxpayers regain the additional $45 billion invested by the government to acquire a 60% stake in the company. An IPO is likely in the foreseeable future, which would see the government divest its stake. How much of the total will eventually be recovered, however, remains to be seen.

GM’s sales number are validated by a recent poll that suggests Americans now favour domestic brands such as GM and Ford over their Japanese rivals, Toyota and Honda. This would have been unthinkable only a year ago. Of course, Toyota’s recall fiasco has certainly helped the American cause – to the extent that Ford announced a staggering $2.1 billion in profit in the first quarter. Don’t forget, it wasn’t that long ago when they reported annual losses to the tune of $12 billion. And while they still have almost $35 billion in debt to service, it appears that Alan Mulally’s strategy is working perfectly.

The good news doesn’t rest merely with the American carmakers either – Hyundai reported record Q1 profits exceeding $1 billion. They’ve been consistently gaining market share in the US, and are emerging as a true global force. Contrast that with the Q1 figure of Europe’s largest carmaker, VW, which reported $640 million in profits.

Another point to note, once again, is that its strong sales in China that are helping these manufacturers achieve healthy numbers. After quite some turmoil, things do appear to be looking up for the global automotive industry.