Toyota outsells GM worldwide in first half
DETROIT (AP) - July 23, 2008 Toyota sold 4,817,941 vehicles globally during the first six
months of the year, company spokesman Hideaki Homma said Wednesday,
beating GM by 277,532 vehicles. Toyota said its global sales rose 2
percent from the same period the year before, while GM's sales fell
3 percent.
It's the second time Toyota has beaten GM in sales in the first
half of the year. In 2007, Toyota outsold GM by about 50,000
vehicles, although GM eked out a win for the full year, retaining
its 77-year position as the world's largest automaker by sales.
Toyota didn't release regional sales totals, but the weakened
U.S. market appeared to be the biggest battleground. With its
reputation for small, fuel-efficient cars and less exposure to the
plummeting truck and SUV market, Toyota's U.S. sales fell 6
percent, compared with a 16 percent drop for GM. Industrywide sales
fell 10 percent.
"The U.S. is definitely the sore spot," said Erich Merkle, an
auto analyst with Crowe Chizek and Co., a Grand Rapids accounting
and consulting company. "Toyota is not doing not well in SUVs and
pickups either, but it's in a pretty good position in the small car
and midsize sedan segments."
Outside North America, GM's sales grew 10 percent. The automaker
reported exploding sales in emerging markets like Russia, where
sales were up 34 percent in the second quarter, and China, where
sales rose 14 percent. GM said that despite the tough sales
environment in mature markets like the U.S. and Japan, it predicts
industrywide global sales will rise 2.5 percent this year to a new
record of 72 million vehicles.
"The growth momentum in emerging markets is still strong,"
said Mike DiGiovanni, GM's executive director of global market and
industry analysis.
Investors shared that optimism, pushing GM shares up 14 percent
before they tapered off later in the day. GM shares were up 51
cents, or 3.6 percent, to $14.83 in afternoon trading. Toyota's
U.S. shares fell 43 cents to $92.44.
Still, GM said its gains elsewhere have yet to make up for its
losses in North America, where sales fell 20 percent in the second
quarter. The automaker blamed high gas prices, which have caused a
steep decline in U.S. truck and SUV sales, as well as a nearly
three-month strike at American Axle and Manufacturing Holdings Inc.
that shut down much of GM's production.
In response, GM is closing four North American assembly plants,
cutting thousands of jobs, selling assets and suspending its
dividend in an effort to raise cash. GM has $24 billion in cash and
access to $7 billion in credit but has been burning through about
$1 billion per month.
DiGiovanni said GM also is struggling in Japan, where consumer
confidence is at record lows and sales have hit their lowest levels
since 1982. Industrywide sales in Western Europe also fell 7
percent, the result of high fuel prices and falling home values.
Toyota hasn't been immune to those troubles. Toyota's profit for
the January-March quarter sank 28 percent from the previous year as
a strengthening yen and lagging North American sales chipped away
at the Japanese automaker's earnings. The company also said it
expects sales to drop for the first time in nine years for the
fiscal year that ends in March 2009.
Toyota's U.S. sales also took a surprising 21 percent dive in
June, prompting the company to make major manufacturing changes at
its U.S. plants. Toyota plans to suspend truck and SUV production
for three months starting in August and will start building the
Prius hybrid in the U.S. for the first time in 2010. U.S. Prius
sales have fallen in recent months as Toyota has failed to keep up
with demand.
Toyota also said last week that its European sales fell 7
percent in the first half, a dip it vowed to reverse with a series
of new, more fuel-efficient products. Merkle said that unlike the
U.S., Toyota has a lot of room to grow in Europe.
"They're finally getting the right product mix there," he
said.
Toyota also is an aggressive player in emerging markets. Last
week, it said it is acquiring land in Brazil for a second plant
that would start making compact vehicles as early as 2011. GM said
its sales in Brazil were up 20 percent in the second quarter.
Toyota has said it expects to sell 9.85 million vehicles
worldwide this year, up 5 percent from last year. But it may lower
that target when it updates its strategy next month. GM doesn't
release full-year sales forecasts.
DiGiovanni said GM now expects the first quarter of 2009 to be
the low point of the U.S. housing crisis, and that home prices and
auto sales will see some recovery after that. He said oil prices
also are starting to show some signs of stability, which could give
a big boost to consumer confidence.
"If people see the price stays in some finite range, they feel
better about the future," he said.
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AP Business Writer Yuri Kageyama in Tokyo contributed to this
report.