Autos

Toyota Passes Volkswagen as World's Largest Car Company

In a year in which global car sales were battered, Japan’s Toyota Motor Corp. (NYSE: TM) passed Germany’s Volkswagen in total sales. Toyota ended the year with 9.53 million sales, down 11% year over year. VW sales were down 15% to 9.30 million. U.S. car companies lagged, primarily because of their weak sales outside the American market.

Toyota demurred when asked about its success. One executive told Reuters: “Our focus is not on what our ranking may be, but on serving our customers.” Its management probably gloated behind closed doors. The figures likely mean that its revenue and profitability may have bested VW as well.

VW’s advantages are its strength in Germany and in China, which is the world’s largest car market. Toyota does particularly well in its home market and the United States, where VW’s sales have been unsuccessful for decades.

VW owns a number of brands, including its flagship and luxury brands Audi and Porsche. Toyota’s primary brands are its flagship and its Lexus luxury division.

General Motors Co. (NYSE: GM) and Ford Motor Co. (NYSE: F) struggled in 2020. GM’s sales in Europe and Japan are unusually poor. It does well in China, where it often leads the market along with VW. It continues to top the U.S. market with a share of about 16%. This is currently built on sales of pickups, sport utility vehicles and crossovers, which have come to dominate the entire national market.

Ford’s disadvantages range across almost every market. It has struggled mightily in China. Its sales in Europe are unimpressive. In the U.S. market, its only real success is its F-150 full-size pickup, which has been the top-selling vehicle in America for decades.

In the year to come, the annual sales figures among the world’s car manufacturing giants will be reordered by their successes, or lack thereof, in the emerging autonomous and electronic vehicle (EV) markets. Each company is pouring billions of dollars into the two categories. Tesla Inc. (NASDAQ: TSLA) continues to be the leader in EV, but the number of models that will be introduced across all manufacturers is staggering.

There is no leader in the autonomous vehicle market, which is well behind the EV market in terms of tech development to create cars that actually work on roads without the need of a driver.


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