It looked like Toyota (NYSE: TM) would pass GM (NYSE: GM) for the No. 1 spot in global car sales for 2007, but it is not clear that it happened. GM sales in China and South America may have been good enough for it to keep the lead spot.

Now Toyota has announced ambitious plans to up its sales 5.6% to 9.85 million vehicles in 2008. That would almost certainly put it ahead of GM and break the U.S. car company's all-time record year set 30 years ago.

According to The Wall Street Journal, "Katsuaki Watanabe, Toyota's president, said the company aims to achieve its bold sales targets by expanding in fast-growing emerging markets." That means the Japanese company will have to do well in growing markets like China and hold its own in the U.S.

Volkswagen has continued to do well in its home market and the rest of Europe. It is also the leading seller of cars in China, competing with GM (NYSE: GM) for the top spot. But, since it sold its compact Beetle sedan here in the 1960s, VW has become a nothing brand in the U.S.

Now the management of VW wants to change all of that, and compete with Toyota (NYSE: TM) for U.S. share using high quality, no-frills cars. According to The Wall Street Journal, Volkswagen has said it wants to sell about 1 million cars annually in the U.S. by 2018, compared with about 330,000 last year.

VW plans to add 12 new models over the next several years and keep prices of models like the Jetta and Passat below comparable Toyota models.

And, that will pick up market share in the U.S.? VW, dream on.

VWs don't sell well in the U.S. because no one wants to buy them. It is not as if the company does not have plenty of dealerships. Its luxury model, Audi, does just fine. But how many car buyers say, "I just have to have one of those new VWs"?

The German car maker is also coming up against stronger products from the locals, Ford (NYSE: F) and GM. Selling cars in the U.S. is part of a life-and-death struggle for them to hold sales in their home market.

VW should keep its focus on China.

Douglas A. McIntyre is an editor at 247wallst.com

Here is some background for Brian White's liveblogging of Ford's (NYSE: F) second quarter earning results:

Ford surprised the market by announcing black ink for the second quarter of 2007, with net income of $750 million, or $0.31 EPS on $44 billion revenue, which was a 6% increase over 2006 2nd quarter.

Unfortunately the increase in revenue was primarily due to currency exchange, mix and net pricing improvements -- sales volume actually was lower than 2006. The profit was due in part to cost reductions of $600 million, including the elimination of 6,400 jobs.

Backing out special items, mostly the sale of Aston Martin and deferred gains on certain hedges at Jaguar and Land Rover, and profits finished at $258 million, or $0.13 EPS. The paltry earnings won't do much to excite a market convinced that the company has taken only the first few initial steps in their climb back to economic viability.

There were several events during the last week that are almost certainly clues to what is likely to happen in certain industries and the economy in general as Wall Street looks forward to the July through September period. The week was dominated by the launch of Apple's (NASDAQ: AAPL) iPhone and the extended glow for AT&T (NYSE: T), but in the broader picture, the news means very little.

Looking at other news:

Oil closed over $70 for the first time since late last summer. While the news may be good for Exxon (NYSE: XOM) and other big exploration and refinery companies, it will hurt industries from air freight to automotive.

Dell (NASDAQ: DELL) hit a 52-week high, a sign that Wall Street believes the PC industry may have a good second half, especially with Hewlett-Packard (NYSE: HPQ) also trading near its high point.

An unusually broad number of stocks representing several important industries hit 52-week lows. While it would be expected that home builders like Beazer (NYSE: BZH) would struggle in a poor housing market, Blackstone (NYSE: BX), Circuit City (NYSE: CC), and one of the nation's largest banks, Wachovia (NYSE: WB) also touched bottoms.

After a long walk on the Venice Beach boardwalk (CA) yesterday I may have gotten notice of things to come. Speaking to several artists on the beach, I learned that they are having a tough summer. Business is noticeably slower this summer than last. They speculate that fuel prices and fewer people wanting to fly has reduced tourism and their customer base.

I have no way of knowing if there is a direct correlation but I can report that the boardwalk was packed and parking was hard to find. Based on my observations, it does not seem like a viable explanation. How could the beach be as crowded as ever and business be slower?

The answer is simple, although unscientific: Consumer priorities and discretionary spending have been altered. The number of people visiting the boardwalk may not be appreciably different. People still love the beach, the sites, the sounds and the people-watching. However, after spending more on gas to get there, ($3.15 to $3.45 per gallon) and paying more for parking ($5 if you walk a distance, to $15) they have less in their pockets. They buy hot dogs, pizza, ice cream, beer, and t-shirts. They have less money to spend on art, jewelery, and novelties.

Why Venice Beach as an indicator?