General Motors is demonstrating a tremendous recovery for their company, and has already begun paying back bailout money that was given by the government last year. This is great news for stockholders who have invested in GM and had to suffer over the last few years with the company’s steady decrease in sales. The government, which owns over 61% of the company stake, may be ready to begin selling their stock investments into the company.

GM showed a loss of $88 billion since 2005 and filed for bankruptcy just over a year ago. The company used a $50 billion bailout to turn the company around, and has proven to do just that. It is still too early to predict how the remainder of 2010 will go for General Motors, but this is a great indication of how the company has been able to turn around so far.

Recent media polls have shown that for the first time in years American consumers rate domestic cars as better than Asian manufactured automobiles. Part of this change in consumers’ attitude toward American cars is the recent trouble Toyota has experienced because of several high profile recalls and charges of a cover up over safety violations that may have caused serious injuries and even death in highly publicized accidents.

GM is expected to announced billions of dollars in profits for the last quarter of 2009 and CEO Whitacre said that the repayment of the government loans is a sign that the company is on the road to full recovery. The company is gearing up to manufacture its new Chevy Volt electric car.

GM Repays Billions To Government

The recall effects Chevy Cobalts, Pontiac G5′s, Pontiac G4′s and Pontiac Pursuits. The company said there is no danger but if the system fails, they will be harder to steer. GM spokesman Alan Adler said it will take time to get the parts and the recalls will go out as the parts come in.

The company will fix the older models first because it takes from 20,000-30,000 miles for the situation to develop. The spokesman said that if the problem occurs, shutting down the car and starting it again will alleviate the situation.

Toyota has recalled more than 8 million cars and public attention is becoming transfixed on the numerous recalls. Toyota has finally felt the wrath of the citizens, when in a recent poll, 40% of Americans said they would not consider a Toyota for purchase anytime soon.

Handling response may be compromised at speeds under 30 miles per hour, say GM officials who noted they had seen an increasing number of complaints about this issue over the past year.

The safety recall is slated for the 2005-2010 Chevrolet Cobalt, 2007-2010 Pontiac G5 and 2005-2006 Pontiac Pursuit models. Older cars will be more disproportionately affected by the problem than newer models, noted GM.

The problem’s there but GM’s not quite sure what to do about it. “GM is still working to determine what is the most effective remedy,” said GM spokesperson, Tony LaRocca. “We’re not sure what that will be.”

In 2009, GM sought protection under federal bankruptcy laws, and received financial guarantees from the US government in return for an equity stake in the company.

In January, Toyota announced it was recalling 8.5 million vehicles worldwide – five million of them sold in the US – for acceleration problems. More recently, Toyota recalled the Prius hybrid for brake problems.

The move has been painted, by Whitacre, as a way to shore up stability in the company’s operations. GM is still in the process of recovering from its shakeup by the government last year and looks forward in June to repaying the loans it received from the Canadian and U.S. governments.

Whitacre sounded optimistic about GM’s future when talking to reporters, telling them that he anticipates them turning a profit as early as this year and expects them to be making an initial public offering in the near future. The latter will allow GM to pay off the remainder of the financial assistance it had received from Canada and the U.S.

Industry analysts have expressed their satisfaction with the selection of Whitacre, confident in the direction he seems to be steering in bringing GM back to its position as leader in the automotive industry. Analysts also point to the current market conditions that favor GM’s prospects for success.

The 68 year old Whitacre served as CEO of AT&T Inc. before coming to GM.

GM appoints Whitacre CEO

General Motors has stated that use of the vehicles was set to end on December 31st and that returning the cars has nothing to do with the infidelity scandal currently revolving around Tiger Woods. Still, Cadillac is one of many endorsement contracts that have recently been terminated following the end to Wood’s squeaky clean image.

After admitting to several extramarital affairs and announcing that he would take a break from his career in Golf, companies endorsing woods such as Accenture, AT&T, Gillette, Gatorade, and watchmaker Tag Huer have followed suit in terminating their endorsement deals with him.

As for the Cadillac Escalade that Tiger wrecked, GM has stated that they will repair the vehicle and most likely auction it off. There is no word yet on whether or not the car’s relationship to Tiger will be revealed on the auction block.

GM Says No More Free Cadillacs For Tiger Woods

In a restucting move, GM said it would cut 2,400 dealers from its 6,000-dealer network by fall 2010.  The company said it could save save $2.5 billion with the move.

However, dealers accused the auto maker of closing several lots which were still profitable.

“We just could not in good conscience accept the GM or Chrysler plans when they rely so much on flawed criteria and would make a mockery of the arbitration process,” the Committee to Restore Dealer Rights said in a statement. “Under their plans, a dealer would have had a better change at winning the Powerball lottery than getting back in business.” The group is headed in part by Jack Fitzgerald and Tammy Darvish, two major D.C.-area auto dealers.

“It’s a good idea, but it’s kind of late, isn’t it?” said John Wolkonowicz, an analyst at consultant IHS Global Insight speaking to Bloomberg While the closings could have been handled better, the new plans will “help some dealers. It’s a good thing and an upfront thing to be doing,” he said.

in response, GM now says it will conduct face-to-face reviews with dealerships.

Automaker To Reconsider Closing Some Dealers