Nearly Every Car Company Says It Will Best Rivals in 2012

Print Email

It is impossible for every company in an industry to gain market share. Yet, almost all of the large car manufacturing executives say that in 2012 they will beat their competition in sales growth rate.

First among the car firms that expect huge growth is Volkswagen, which did well in the U.S. and China in 2011. The American market has been a troubling one for VW, though. Its market share in the U.S. is still small. And America is still the second-largest car market in the world after China, so results in the U.S. are very important. VW also expects sharp sales gains in China, as does almost every other multinational car company. In the meantime, car and light vehicle sales in the People’s Republic have slowed. The market’s pie, which represents more than 16 million new sales a year, has not expanded much recently.

Toyota (NYSE: TM), Honda (NYSE: HMC) and Nissan expect to pick up sales in every portion of the world, now that each has reached full production. The Japanese earthquake in March knocked many of their factories and those of suppliers off line. Toyota and Honda expect to regain much of their lost market share in the U.S. America car companies and rapidly growing South Korean brands Hyundai and Kia expect to add market share as well.

VW expects American car and light vehicle sales to rise 10% this year. Total sales of cars and light trucks in the American are expected to rise from 12.8 million in 2011 to about a million more than that in 2012. That hardly means that all of the major car companies can pick up one or two share points. Even the expanding U.S. market cannot be larger than 100%.

Luxury car companies have made claims similar to their larger competitors. BMW says it will have record sales this year. So do Audi and Mercedes-Benz. Ford (NYSE: F) has forecast an improvement in its troubled Lincoln luxury brand. General Motors (NYSE: GM) says the resurrection of its Cadillac brand will continue. Lexus, Infiniti and Acura — each of which is part of a large Japanese multinational manufacturer — all expect improvement as their production facilities renew full output.

The Detroit auto show is this week. Almost every manufacturer will forecast large gains in both sales and market share. Not everyone can be right. But executives cannot help themselves. Everyone’s shareholders want to hear how great things will be now that the recession in car sales has, to some extent, ended.

Douglas A. McIntyre