Toyota Retains Lead as World's Biggest Automaker
Toyota has maintained its position as the world's largest automaker by sales, outperforming its German competitor Volkswagen for the fourth consecutive year. However, the company faces challenges and scandals that threaten to overshadow its success.
Toyota's Global Dominance
In a remarkable display of its continued dominance in the global automotive market, Toyota has announced that it sold a record 11.2 million vehicles worldwide in 2023, including its Daihatsu and Hino lineups. This impressive figure represents a 7.2% increase from the previous year, solidifying Toyota's position as the leading automaker in terms of sales.
In contrast, Volkswagen Group, Toyota's main rival, reported delivering 9.2 million vehicles last year, reflecting a 12% increase compared to 2022. The competition between the two automotive giants has been ongoing, with Toyota surpassing General Motors in 2012 to become the world's top carmaker, only to be later overtaken by Volkswagen in 2017.
Toyota attributed its growth to solid demand in each region and the easing of semiconductor shortages. Notably, sales in Japan surged by 20.9%, while overseas sales saw a 4.1% increase. This robust performance has further cemented Toyota's position as a global automotive leader.
Challenges and Scandals
Despite its impressive sales figures, Toyota is facing significant challenges, particularly related to the certifications of some of its vehicles. The company recently announced the suspension of shipments of certain models due to irregularities found in certification tests for diesel engines developed by its affiliate, Toyota Industries.
Members of the special investigation committee hold press conference regarding Toyota Industries' engine certification fraud in Tokyo on January 29, 2024.
This revelation comes on the heels of another scandal involving Daihatsu, a small carmaker owned by Toyota, which halted domestic production after admitting to forging the results of safety tests for more than 30 years. These scandals have raised serious questions about Toyota's commitment to quality and integrity as an automobile manufacturer.
Furthermore, Toyota has issued warnings and recalls for certain models, including the Corolla and RAV4, due to the risk of exploding airbags, posing a serious threat to the safety of vehicle occupants. These safety concerns have further tarnished Toyota's reputation and raised doubts about its commitment to consumer safety.
Rising Competition and EV Market
While Toyota continues to grapple with internal challenges, its competitor Volkswagen has seen growth in all regions, especially in Europe and North America. The company's focus on fully electric vehicles (EVs) has resulted in a nearly 35% increase in sales of EVs, with 771,100 units sold in 2023.
In contrast, Toyota, which has historically lagged behind in the global EV race, sold 104,000 battery-powered vehicles in 2023. Despite being a leader in hybrid cars, Toyota faces an uphill battle in the rapidly evolving EV market, where legacy automakers and new players are aggressively expanding their EV offerings.
The competition in the EV market has intensified, with Chinese automakers gaining market share and triggering price wars. Tesla's price cuts in China have led to increased sales but have also impacted industry-wide profitability. Chinese electric automaker BYD, backed by Warren Buffett, has emerged as a major player in the global EV market, surpassing Tesla as the world's biggest seller of electric vehicles.
