MercoPress. South Atlantic News Agency

Toyota en route to dethrone GM as world's top automaker

Japan's Toyota sold more vehicles globally in the first quarter of 2007 than General Motors according to preliminary figures 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 Corporation, which lost 2 billion US dollars last year, has been forced to scale back production and cut costs in a bid to revive its sliding fortunes, even when it leads in China's booming market and Latinamerica. Toyota reported sales of 2.35 million vehicles worldwide in the first quarter, surpassing the 2.26 million vehicles GM said it sold in the period. In 2006, Toyota's global output rose 10% to 9.018 million vehicles, while GM and its affiliates produced 9.18 million vehicles worldwide - a gap of about 162,000. Industry analysts believe Toyota in 2007 will dethrone GM's 76 years leadership in sales. 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 adding GM will be hard pressed to play catch-up, making it more likely that Toyota will outstrip GM for the full year. 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. Toyota was founded in 1937 by the Toyoda families whose members continues 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. 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 11.8 billion US dollars 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. General Motors moves to boost overseas production have been successful: sales in China jumped 32% last year to 876,747 units, making it the No. 1 seller there. It is also building a new factory in India, another market with tremendous potential.