A BAD IDEA THAT WORKED:

[T]he most compelling argument turned out to be the damage not bailing out GM and Chrysler would inflict on the entire economy. The demise of GM and Chrysler would decimate the supplier network, which, in turn, would destroy Ford and cripple foreign automakers operating in the United States, some of whom were already having second thoughts about the country at all. Ultimately, the US economy would be in shambles worse than it was, the thinking went.

Heeding warnings that if GM and Chrysler went into bankruptcy, they might never come out, the Obama administration chose a hybrid solution. GM and Chrysler were forced to file for Chapter 11 reorganization under US bankruptcy laws, and undergo a painful restructuring, but they would merge from the process in short order, funded by loans from US and Canadian taxpayers.

Fast forward three years and the investment to save GM and Chrysler, the full amount of which may never be recovered, continues to be debated. But what can't be argued is that US auto sales are recovering and so, too, are Detroit automakers. When the books closed on 2011, US vehicle sales had risen for the third consecutive year to 12.8m vehicles - from 11.6m in 2010, and 10.4m in 2009, the lowest in 27 years.

In 2011, GM, Chrysler and Ford combined grabbed 47.1% of the American vehicle market, up 1.7 percentage points in a market where tenths of a point are significant. Last year marked the highest combined market share for the Detroit three since 2008, when it was 48.3%.

In the past month, the Detroit Three have reported significant profits. Ford earned $20.2bn, its best earnings since 1998 and its second-biggest annual profit in its 109-year history. After losing $652m in 2010, Chrysler made $183m last year, its first full year of positive earnings since 2005 - and that was despite paying off loans to the US and Canadian governments. Of all major automakers selling vehicles in the United States, Chrysler experienced the largest sales increase at 26% from 2010, prompting a gain in market share to 10.5%, from 9.2%. GM, which last year returned to its perch as world's biggest volume automaker, has posted a record 2011 profit of $7.6bn, Thursday.

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