Bloomberg News

Toyota Extends Global Sales Lead Over General Motors, VW

July 26, 2012

Toyota’s 34% Growth Sets Pace to Take Sales Crown From GM

The Toyota Motor Corp. logo at the company's showroom in Tokyo. Photographer: Kiyoshi Ota/Bloomberg

Toyota Motor Corp. (7203), rebounding from lost production after last year’s natural disasters in Asia, is on pace to outsell General Motors Co. (GM:US) and Volkswagen AG and reclaim its title as the world’s top-selling automaker.

Toyota sales rose 34 percent in the first six months of the year to 4.97 million globally, leading GM by 300,000 and VW by 520,000 deliveries. GM global deliveries rose 2.9 percent to 4.67 million during the first half while VW sales increased 8.9 percent to 4.45 million, according to the companies.

The results pave the way for Toyota, led by President Akio Toyoda, to reclaim the lead in annual global auto sales from GM a year after the tsunami in Japan and floods in Thailand roiled production. The recovery in production helped Toyota’s sales rebound in the U.S. and Japan, its two biggest markets, while GM and Volkswagen struggled with a shrinking European market.

“Toyota has bounced back stronger than expected,” Jeff Schuster, senior vice president of forecasting for LMC Automotive in Troy, Michigan, said yesterday in an e-mail. “We are now at the critical mid-year point in the race, and given Toyota’s lead, it will be very difficult for GM to catch Toyota.”

While the largest Asian automaker expanded its lead from 210,000 vehicles over GM and about 330,000 over VW after the first quarter, the Toyota City, Japan-based company may start to lose some momentum.

“Keep in mind Toyota’s sales may be stronger in the first half of 2012 than the second half because they are still recovering from the impact of the tsunami last year and re- stocking dealerships, pulling in consumers who may have waited,” Rebecca Lindland, an industry analyst with IHS Automotive, said yesterday in an e-mail. “But that positive impact will trail off as the year progresses.”

Global Battle

Toyota, GM and VW are locked in a battle for global supremacy and the bragging rights and scale that come with being the world’s biggest automaker.

“I’m sure GM would love to be No. 1, but they would rather be profitable so they are not going to get into a market-share race at the expense of their balance sheets,” Lindland said.

Toyota overtook GM to become the world’s largest automaker by sales in 2008 as the U.S. market collapsed and GM headed toward bankruptcy reorganization in 2009. GM, based in Detroit, regained the sales lead last year as Toyota’s output was limited following the natural disasters in Asia.

“It’s difficult to compare this year to last year because last year was such a special circumstance,” Dave Sullivan, product analyst at AutoPacific Inc. in Troy, Michigan, said in an interview.

Difficult Comparison

GM’s new Cruze small car benefited from Toyota’s limited presence in the U.S. market last year, Jesse Toprak, an industry analyst from TrueCar.com, said in a telephone interview.

U.S. sales of the Chevrolet Cruze soared to 231,732 from 24,495 in 2010 when the vehicle first arrived in GM’s home market. So far this year, Cruze sales in the U.S. fell 7.4 percent, according to researcher Autodata Corp.

When “you couldn’t find a lot of Japanese cars, you had these new domestic products, it was almost the perfect storm,” Toprak said. “When consumers are thinking small car, most consumers in the U.S. are still thinking Japanese, they’re still thinking Toyotas.”

Toyota has also been more aggressive with incentive spending in the U.S., he said. Toyota spent on average per vehicle $1,942 in June compared to $1,579 on incentives during calendar-year 2009, according to Woodcliff Lake, New Jersey- based Autodata. “They are more competitive,” he said.

GM Europe

GM, which posted a record calendar-year profit of $9.19 billion in 2011, is struggling to stem losses in Europe. The automaker’s U.S. share fell to 18.1 percent after six months this year from 19.9 percent during the same period last year, according to Autodata. Toyota’s U.S. share rose to 14.4 percent from 12.8 percent.

Seventy percent of GM’s U.S. nameplates will be redesigned or new in 2012 and 2013, Cain of GM said.

“We are in the early days of the most aggressive roll-out of new products in our history, which will help us press our advantage in the U.S. and China and grow profitably around the world,” Cain said in the e-mail.

Toyota’s sales include Hino and Daihatsu models. GM’s sales include the Wuling brand in China. While Volkswagen has several brands, including Skoda, Audi and Lamborghini, its total doesn’t include Porsche, which the Wolfsburg, Germany-based company takes over next month. VW (VOW) reports second-quarter earnings today.

GM rose 1.6 percent to $19.11 at the close in New York. The shares slid 42 percent from their November 2010 initial public offering. Toyota’s American depositary receipts rose 2.2 percent to $74.11.

To contact the reporter on this story: Tim Higgins in Southfield, Michigan, at thiggins21@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net


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