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Toyota's Reign as World's Largest Carmaker at Risk

Oct. 27, 2016
Barring a late comeback by Toyota, automaker Volkswagen will pull ahead this year thanks to its leading position in China.

Toyota Motor Corp. (IW 1000/6) trailed Volkswagen AG (IW 1000/8) in global sales in the first nine months, putting its four-year reign as the world’s largest carmaker at risk.

Worldwide deliveries rose 0.4% to 7.53 million vehicles in the nine months through September, Toyota said in a statement Thursday. Volkswagen’s sales climbed 2.4% to about 7.61 million in the same span, according to an Oct. 14 statement.

Barring a late comeback by Toyota, Volkswagen will pull ahead this year thanks largely to the diverging fortunes of Japanese and German automakers’ biggest overseas markets. While Toyota has joined the broader U.S. auto industry in a sales slowdown, Volkswagen is benefiting from its leading position in China and a tax cut that’s stoked buying since last last year.

In China, where Volkswagen outsells Toyota by a 3-to-1 margin, the Wolfsburg, Germany-based company has boosted deliveries by 11% to 2.58 million units through September. Industrywide deliveries may expand 7% to reach a record 26.3 million this year, according to an estimate by the China Association of Automobile Manufacturers. The government is looking at extending the tax cut that’s set to expire at the year-end, according to Qu Guochun, an official with the industry ministry.

Toyota’s U.S. sales have slipped 2.4% to 1.82 million units through September, as low gasoline prices sap demand for its redesigned Prius hybrid. After a record 2015, industry growth has slowed to just 0.5% this year, according to researcher Autodata Corp.

By Craig Trudell and Yuki Hagiwara

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Licensed content from Bloomberg, copyright 2016.

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