Toyota Passes GM To Top World Auto Sales For First Time:
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AP said:TOKYO — For the first time ever, Toyota sold more vehicles globally in a quarter than General Motors, preliminary January-March figures show, the clearest sign yet that the Japanese company is on track to overtake its U.S. rival as the world's top automaker.
Toyota Motor Corp.'s success is fueled by robust demand for its reliable, fuel-efficient models, including the Camry, Corolla, Yaris and gas-electric hybrid Prius.
It also comes at a time when General Motors Corp., which lost $2 billion last year, has been forced to scale back production and cut costs in a bid to revive its sliding fortunes, even as it leads in China's booming market.
Final bragging rights as the world's top automaker _ a title GM has held for 76 years _ won't be decided until global vehicle production numbers get tallied for the full year.
But Tuesday's data show that Toyota is getting closer. The Japanese company sold 2.35 million vehicles worldwide in the first quarter, Toyota said, surpassing the 2.26 million vehicles GM said it sold in the period, according to preliminary figures.
In 2006, Toyota's global output rose 10 percent to 9.018 million vehicles, while GM and its affiliates produced 9.18 million vehicles worldwide _ a gap of about 162,000. In the first quarter, Toyota made 2.37 million units while GM had expected to produce 2.34 million during the same period, and has not given a final number.
Analysts say Toyota is building on its lead by investing in ecological technology, opening plants around the world, developing new models and wooing drivers with solid marketing that drives home its brand power.
Those are precisely areas in which GM has fallen behind Toyota, analysts say. GM will be hard pressed to play catch-up, making it more likely that Toyota will outstrip GM for the full year, they say.
"Toyota sales are booming because of its good image around the world about reliability and ecological technology," said Koji Endo, auto analyst with Credit Suisse in Tokyo. "It's just the opposite for GM, and its image is deteriorating."
GM said although Toyota won the first quarter, the fight for global leadership is not over for the year. A company spokesman said it would not chase market share solely to recapture the lead from Toyota, and it has no special plan to retake the lead.
"We also had a record first quarter globally. We set sales records in three out of our four regions," said spokesman John McDonald. "We've got our first quarter underneath our belt. Let's see what the rest of the year holds for us. We're going to fight for every sale," he said.
The cycle of good news keeps getting better for Toyota, however, as it can use its profits to keep growing. With the company doing so well, morale is high at Toyota, keeping the positive cycle going, while GM tends to be dragged down by battles with its union, Endo said.
But Endo also warned that increased size also brings other problems like trying to ensure quality and manage a sprawling network of manufacturing and sales.
"As your volume gets bigger and bigger, in many cases efficiency tends to drop," he said. "There might be a risk of being over-stretched."
Toyota was founded in 1937 by the Toyoda family, whose members continue to play key roles and are a symbol of emotional unity for the company and its employees.
Perhaps more famous than the Toyoda family are the company's innovators, such as Taiichi Ohno, credited with inventing just-in-time production to reduce inventory, and the philosophy of worker-empowerment called "kaizen," allowing workers to keep improving production methods and hold the critical power of shutting down the assembly line at any time.
Companies around the world, including those outside the auto industry, have adopted Toyota's methods. Universities, both in and outside Japan, study the Toyota method.
Toyota is also well-known for nurturing worker loyalty by offering lifetime employment. The last time Toyota resorted to massive job cuts was during hard times in 1950.
Toyota has beaten GM in profitability for the past four years, with 1.4 trillion yen ($11.8 billion) profit for the fiscal year through March 2006.
GM, meanwhile, has been negotiating severance packages with thousands of workers in an effort to turn around its North American operations. In the fourth quarter of 2006, it reported a profit of $950 million, a big turnaround from a loss of $6.6 billion a year ago.
Modesty is also a Toyota trademark, and executives have repeatedly played down the prospects of overtaking GM.
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