General Motors Likely to take top sales spot from Toyota this year.
With Toyota’s safety recall woes still lingering and production problems resulting from the Japanese earthquake General Motors is almost a lock for the title of biggest automaker this year. Retaking the top spot from Toyota will be a huge morale booster for the employees of GM and would be icing on the cake for a remarkable comeback after bankruptcy.
General Motors market share is up, mainly in the world’s top two markets, China and the U.S. But even though GM came within 30000 sales of Toyota last year and has had a strong start in 2011, any victory this year has more to do with Toyota’s problems than it does General Motors new found resurgence.
The two major problems for Toyota have been the recalls that started in 2009 and have ballooned to over 14 million vehicles worldwide. Secondly the March 11th earthquake and tsunami that hit Japan has hindered Toyota’s production of cars. That translates into shortages across the globe. So far the crisis has cost Toyota the production of 260000 vehicles. Last year Toyota sold 8.42 million vehicles.
Not all of GM’s growth is a result of Toyota’s problems though. Three years ago GM was saddled with huge debt, out of control pensions, their quality was suspect and very few of their products were appealing to consumers other than pickups. With the help of a government bailout GM emerged from bankruptcy much leaner and with a new focus on quality and style. Since then they have come up with hits that include the Buick LaCrosse luxury car, the Chevrolet Cruze compact car, the Chevrolet Volt electric car, and the small SUV Chevrolet Equinox. Both the fuel efficient Cruze and Volt hit the U.S. market just as gasoline prices started to rise. Sales so far this year are up 25 percent in the U.S. and 10 percent in China. These are important percentages because China is now the world’s largest auto market. Through March 2011 GM has sold more than three times the vehicles Toyota has in China.
It appears that General Motors would have to run into major problems to let the number 1 spot slip away this year. So far they have not been seriously affected by the parts shortages resulting from the Japanese disaster. There are however a few key electronic components that are still made in Japan; if shortages do occur and they cannot be produced elsewhere GM could run short of some models this year.
Tags: General Motors, toyota