GM set to win back top spot from Toyota

GM set to win back top spot from Toyota

GM set to win back top spot from Toyota

 The No 1 title, a morale booster for the winner’s employees and managers, would cap GM’s remarkable comeback from bankruptcy.

GM’s sales are up, mainly in China and the US, the world’s top two markets. Its cars are better than in the past, especially small ones.

But even though GM came within 30,000 sales of Toyota last year and began strong in 2011, any sales victory this year has more to do with Toyota’s problems.

First, a series of big recalls has ballooned to 14 million vehicles worldwide and damaged Toyota’s reputation for reliability. That has spurred loyal buyers to look at other brands. Second, a March 11 earthquake and tsunami in Japan curbed Toyota’s car production. That means buyers across the globe may not be able to get the models they want. Already the crisis has cost the company production of 260,000 vehicles.

Last year, Toyota sold 8.42 million cars and trucks, barely ahead of a resurgent GM, which sold 8.39 million. GM held the No 1 spot from 1932 until 2008. General Motors Co was dysfunctional three years ago, hobbled by enormous debt and a giant bureaucracy. Its quality was suspect, it lost billions, and it had few products other than pickups that buyers found appealing. After a government bailout, a leaner GM emerged from a 2009 bankruptcy with new vehicles and a focus on Chevrolet, Buick, GMC and Cadillac. Since then, GM has come up with hits including Chevrolet Equinox small SUV, the Buick LaCrosse luxury car, and Chevrolet Cruze compact. Its quality is better. Sales so far this year are up 25 per cent in the US and 10 per cent in China.

Bad publicity from recalls was hurting Toyota long before the earthquake. Sales are up 12.5 per cent so far in 2011, but only at half the growth of GM.

Toyota is scrambling to keep factories open and US dealers expect to run out of some models. Already dealers are reporting shortages of Prius gas-electric hybrid. Toyota still has loyal customer base that believes the cars are safe and will last forever. GM would have to run into major problems to let No 1 slip away this year.

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