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(photo credit: Kiichiro Sato/AP)
Japan's Toyota Motor Corp. sold more cars and trucks last year than General Motors Corp., stripping the Detroit automaker of the No. 1 global sales crown. But it's a victory made hollow by the overall industry's continued struggle for viability amid one of its worst sales declines ever.
GM said Wednesday it sold 8,355,947 cars and trucks around the world in 2008, falling about 616,000 vehicles short of the 8.972 million Toyota announced Tuesday.
Toyota's move into the top sales spot wasn't a huge surprise. The automaker nearly topped GM in 2007, selling only about 3,000 fewer vehicles than the US company did that year.
Mike DiGiovanni, GM's executive director of global market and industry analysis, downplayed the significance of the drop to No. 2, saying the automaker was focused on profitability rather than sales volume.
"I don't think being No. 1 in vehicle sales means much at all to the American consumer," DiGiovanni said in a conference call with analysts and automotive journalists. "I think what matters most to the consumer is strong brands and strong products. And the key thing right now, with what the industry is going through now, is viability and profitability."
He said all automakers were currently facing risks and challenges not seen since the Great Depression, adding that even Toyota expects to post an operating loss for the current fiscal year - the Japanese automaker's first in 70 years.
Toyota's overall global sales fell 4 percent for the year, marking that automaker's first decline in a decade. The Japanese automaker has cut production in both North America and Japan in order to align its product offerings with slowing consumer demand.
GM posted an 11% drop in global sales for the year, which it linked to the steep drop in vehicle demand in its key North American and European markets, where Toyota doesn't have as large of a presence. North American sales dropped 21% for the year. GM Europe sales fell 6.5%, including a 21% plunge in the fourth quarter amid the global market meltdown.
Those declines were partially offset by a 3.2% increase in sales at its Latin America, Africa and the Middle East and 2.7% growth in Asia-Pacific sales. Sales outside of the United States accounted for 64% of GM's global sales in 2008, up from 59% the year before.
DiGiovanni said Toyota's move to the top of sales rankings did not necessarily signal a turning point in the industry. He said it was entirely possible that GM could regain the No. 1 spot once US and European markets recover and sales in key emerging markets pickup.
"That story has yet to be written," DiGiovanni said. "Nobody knows what's going to happen."
But first GM has to figure out how to survive long enough to take back its crown. The struggling automaker, which has closed plants and laid off workers to cut production, as it faces the worst US auto market in more than 25 years, received a $13.4 billion lifeline from the federal government last month. But the bailout engineered by the former administration requires GM to achieve "viability" by March 31. The loan may be called back if the government determines GM hasn't met that goal.