Back in April 2005, Eric Wahlgren of Business Week, wrote about the then unthinkable prospect of oil hitting $100 a barrel. In that article I suggested that Toyota Motor Corporation (ADR) (NYSE: TM) might benefit if oil prices rose. That's because it seemed to be taking the lead in making hybrid vehicles. Even though its Prius only accounted for a small portion of its sales, I thought it would keep pushing ahead of its U.S. competitors due to its higher quality, higher prices, and lower costs.

Today, according to The Associated Press, Toyota surpassed Ford Motor Company (NYSE: F) as the U.S.'s second largest vehicle manufacturer. Ford has been in second place since 1931. And the global sales tallies are yet to be completed, however, The Associated Press reports that Toyota -- which estimates that it made 9.51 million vehicles in 2007 will surpass General Motors Corporation (NYSE: GM)'s total of 9.284 million vehicles for 2007.

Since April 26, 2005 when the Wahlgren article was published, Toyota stock has risen 47% while General Motors stock is down 11% and Ford has fallen 35%. Concerns about Toyota overtaking U.S. auto manufacturers' global lead have persisted for about 25 years. Despite occasional efforts by GM and Ford to stop Toyota's inexorable advance, Toyota is now the world leader.

And its prescient response to $100 a barrel oil is helping Toyota to extend its lead.

Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.