It was a matter of time before Toyota Motor Corporation (ADR) (NYSE: TM) overtook General Motors Corporation (NYSE: GM) as the largest seller of worldwide automobiles. In Q1 of this year, that finally happened, as Toyota sold 2.35 million vehicles in the quarter to GM's 2.26 million. What is so special about Toyota, and why is the automaker selling so many vehicles these days?
In the U.S. marketplace, Toyota doesn't have the overhead costs of GM (pension, health care and other labor costs), so its vehicles can be priced more attractively. Toyota's styling in its passenger car division is widely regarded as miles ahead of the boring and staid GM designs (save Pontiac, which gets it). Combine that with the reputation (however truthful or not) that Toyota vehicles are infinitely more reliable than GM's units and, well, there you go.
Toyota's marketing focus on miles per gallon and its brilliant marketing on alternative-powered and hybrid cars (and SUVs) has won it converts from the green car buyer as well. GM has a rather large E85 effort underway for this same crowd, but the marketing is not there and the campaign lacks panache.
Add all this up together and it's no wonder Toyota finally surpassed GM this past quarter. The question is: can the Japanese automaker keep it up this entire year? GM's back in the hunt and has fixed quite a few things recently. Ford is still floundering a bit but massive changes are happening there as well.
Last updated: February 12, 2012: 08:18 PM
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Reader Comments (Page 1 of 1)
4-24-2007 @ 6:03PM
Jane said...
GM and Ford are getting a bad rap. I had a 2000 Ford Windstar van. After 141,00 I sold it to a young couple with children and they are thrilled with it. The only reason I sold it is because I went out of a small business so no longer needed it.
I now have a Buick Certified 2500 LeSabre which averages 27 mpg on gas. I loved my Ford and I love my Buick. I would not buy a foreign car.
4-24-2007 @ 6:40PM
eagle908 said...
I have a 2005 pontiac bonneville,Its great on mileage 28.4,3.8 supercharged v6,I bought it for the sporty look.I have had people say that it is one of the best looking cars they have ever seen.Americans have always been in love with their cars,if GM and ford wants their cars to sell lets get back to the styling and looks.I am 60 years old,but I don't fell 60 when I drive this car.
4-25-2007 @ 7:51AM
jpdr1100 said...
All three models mentioned in the prior messages are out of production. GM no longer produces LeSabres (though it has a replacement) nor Bonnevilles. Ford is giving up on minivans.
That sould tell you plenty about the state of Detroit.
4-25-2007 @ 9:33AM
Carl said...
GM is now paying for the sins of it's 1970 to 1995 period. The sad part is that according to J.D. Power, Ward's Automotive, Consumer Reports and the Harbour Report....... GM's powertrain and chassis reliability now equals AND OCCASIOANLLY SURPASSES what Toyota puts on the road. However, there is no way you are going to convince the American public of this fact, because Americans today a firmly convinced that we make inferior products in our own country.
4-29-2007 @ 7:42AM
fred said...
it's a sad day in America when we let a Jap company take over our manufacturing power. I'll put my Pontiac G6 and Chev. Impala up against ANY import.Wake up America...or learn to speak Jap.
SUPPORT THE COUNTRY YOU LIVE IN OR LIVE IN THE COUNTRY YOU SUPPORT !
4-25-2007 @ 5:00PM
gumbo said...
No profits no service simple as that...
UAW doesnt allow GM and Ford to maximize profits to attract shareholders.
Enough of your dog and pony shows and how good your cars runs... It doesnt count much.
Wall Street wont bet on GM and Ford and help them win market share if there is not ENOUGH PROFITS to come by.
UAW started it all!! Please no more dog and pony shows!!
4-25-2007 @ 5:04PM
Gary said...
It just makes my blood boil when I see these new Jap pickups using American old west music as a backround. Thats for good American trucks like Chevy Ford and Dodge. We have great trucks and cars. 40 miles to the gallon on a civic--WOW, who can get in one?
Many thanks to our Government to help making things the way they are. SAD
4-25-2007 @ 5:13PM
gumbo said...
Brian White
You dont understand...Japan Inc is funding industries with national health plans and stuff. Their system is different. Ours is different. You cant use the health cost argument as a disadvantage for gM and Ford. GM and Ford is making so much hay but GM and Ford is so busy stuffing UAW pension and benefits coffers year over year . Each has over $100 billion already... GM and Ford is simply cookng the books to take advantage of the markets. Now it may be great to buy GM and Ford bonds with high interest. When GM and Ford improves if ever, you wll make killing on bonds.. GM and Ford is raping shareholders holding the common stock. They are dancing around them. That is why GM and Ford is worth one tenth of annual revenues. Everyone stay away from GM and Ford. They had been playing that game for decades until now when suddenly car part makers go under enmasse. That might be unexpected or part of the plan.. UaW may be shedding members to save what is left. UAW is painting itself into the corner. Noone will probably tuch GM andFord shares ever again. If it is true, then it is bye bye time for GM and Ford. the bond scam game may not save GM and Ford. Brian White, please do not give us crap about health costs etc... GM and Ford can compete like other industries here with same costs ... GM and Ford had been playing rope-dopey game inthe boxing match for too long and we are smarting up. We probably wont buy up GM and Ford stock ever again. UAW will make "demands" that management not to reveal too much profits so to keep salting away into UaW pension and benefits coffers. UaW proably wont allwo GM stock to hit 90 and above or Ford over 40 or so. UAW is controlling the stock prices artificially. UAW is looking for advantages for themselves at the expenses of shareholders. UAW throw dog and pony shows , Nascar shows etc to keep enthusiasm up enough to survive. UAW is not interested in working hard for shareholders. So why buy GM and Ford stock at all. We better not until UAW is disbanded first. Is ther any better way???
4-25-2007 @ 5:22PM
Gary said...
To Gumbo, Maybe you just don't remember the American way of life. Back in the forty's the auto company's were stepping all over the workers so they formed a union. Life slowly got better for all Americans not just the auto worker. The Japs were only good for one thing , killing inocent Americans in 1941. They didn't know how to make a good car.
Horse and Pony show's ha
4-25-2007 @ 5:34PM
Gary said...
Is America suppose to change there way of life overnight? We can't and probably never will. We don't have a Japenese Government. We have to pay for our insurance or the Company's do. It's our way of life.
The Jappy's have only been in the auto business a fraction of the time we have. Our car makers are paying millions in benifits for retiree's
4-26-2007 @ 3:50AM
gumbo said...
Gary
Now UAW is screwing around with shareholders with much help from management. UAW thought they could make smoke and mirrors with shareholders by calling managment as lousy. Actually, management did a top notch job for UAW by salting away $100 billion into UAW pensioin and benefits coffers. GM cut dividends since 1989 when $5 was last paid to shareholders. No wonder no body is buying GM shares or Ford's. Dont give me crap about past times. It was over and history . I have a rear mirror in my car and it is enough for me. I dont need to use yours. So if you think you can get tough with management which is not a real story to start with. It is you and me the shareholder. Guess who will win? ME!! NOT YOU YOU RAT FINKS!!
4-26-2007 @ 3:52AM
gumbo said...
Gary
Now you can go to all stupid dog and pony shows or Nascar races for all you care. I wont go there . no thank you you assfaced crunky redneck ol timer!!
4-26-2007 @ 4:08AM
brettze said...
GM is sad. Ford is sad. UAW is sad. Together, they are waiting for the stocks to go up again and start celebrating again as if nothing happens. Sad !! oOOOHhhhh saaaddd@!!!!!! hooo bbooyy!!
4-26-2007 @ 4:10AM
brettze said...
DJIA 30 has the worst member namely, GM!!!! I used to think that Ford was also a member of DJIA until a poster corrected me , oops! Anyway, GM stock is where DJIA was at probably 400 or 750 more than 25 yearsa ago. or further back ... UAW are a bunch of Rip Van Winkles just waking up and surprised to see everyone zooming up to the stars!!! at 13,000 now!!! Why are we still keeping GM in DJIA? Because it is still big and sad!!!!Poor sad GM , we feel sorry for GM so we decide to keep GM in DJIA . This cost DJIA about 1000 points, I believe... DJIA would have been at 14,000 by now or 15,000 .... See what I mean.. GM with UAW is a big big big sad sad sad drag on D J I A !!! Come, Barney, let us sing!!! Poor sad GM fa lalalala!!
4-26-2007 @ 4:11AM
brettze said...
Push GM out of DJIA now!! UAW will be a lot sadder!!! Crunky sad rednecks, that is it..
4-28-2007 @ 10:18PM
Tom said...
Toyota passed GM simply because if a part cost 10 cents more to deliver better reliability THEY BOUGHT IT.
If GM or FORD could save 10 cents on a part using a cheaper less reliable one THEY bought it.
Over the years that paid off for Toyota while GM and Ford tried to "fool" the American public long ago with their answer to the reliable Toyota Corolla.......The Pinto and the Vega.
Theirs your reason. I don't support greedy skimming UNIONS and do not buy goods from UNION employees. American or not.
4-29-2007 @ 2:06PM
gumbo said...
Fred
Yeah you live in this country but you are not supporting this country. We are supporting you and your crunky redneck lifestyle...
5-01-2007 @ 1:54PM
dangcivic said...
You guys who are saying support gm support ford and blaming the japs for their problems are retarded. Most of your trucks and cars are built in mexico now. Toyota has better paying jobs in their plants here in the US then most of gm's plants. If you want to blame who's not supporting GM and Ford, blame themselves.
5-01-2007 @ 4:24PM
A D said...
4. All Toyota did was buy off "our" politicians and then make sure that they lie as much as posible about trade.
Ask yourself after you go search international interest rates why Japan's prime is at less than a single digit, are they manipulating currency?
You know they are. They are doing it to use what was our wealth to pay for all the benefits we supposedly want. You fools with Camrys and Accords have no right to complain about healthcare or broke schools. You take pride in making sure that you don't pay for them but instead buy those things for the consumate liars from Japan.
When it all comes out about how this nation has been fleeced, I wonder how shiny that POS Nissan will be then?