VW to overtake Toyota before year's end?

Battle of the big brands: Bloomberg predicts Volkswagen's global domination is inevitable
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Industry analysts surveyed by news outlet Bloomberg are predicting Toyota's misfortune this year will propel Volkswagen into the top spot for 2011.

Bloomberg calculated average global sales fluctuations for Volkswagen, Toyota and General Motors based on statistical input from three industry analysts: J.D. Power, IHS Automotive and PwC Autofacts. IHS Automotive rates GM as the company most likely to finish the year in top spot, with some help from the multinational's joint venture in China with SAIC Motor Co. Neither of the other two analysts based their predictions on the same aggregate figure.

According to Bloomberg's assessment of the situation, Volkswagen will see global sales lift by 13 per cent (8.1 million vehicles), with GM expected to pick up eight per cent (7.55 million) and Toyota's volume anticipated to fall nine per cent (to 7.27 million). If the IHS Automotive method skewed the result in GM's favour, the J.D. Power formulae has more than compensated in Volkswagen's favour.

Quoted in an article published by Automotive News Europe, Jenny Gu, a market analyst employed by J.D. Power in Shanghai, observed that Volkswagen's good fortune had arisen through the company's focus on the BRIC nations (Brazil, Russia, India and China), as well as other emerging markets.

"Emerging markets are at a stage of car-adoption by consumers and there is still a large space for sales to grow," she said. "VW realized this and put a lot of effort on emerging markets."

J.D. Power & Associates report that Volkswagen, third-placed in the world rankings last year, has pumped up sales in China by 20 per cent this year, in addition to selling more than twice as many cars in India. Volkswagen's combined sales in the two countries (each with a population over a billion) amounts to 2.3 million vehicles, or about a third of the company's production output. Reaching number one has been a long-held ambition for Volkswagen, but it now appears it may happen sooner rather than later — albeit briefly perhaps.

Toyota, as motoring.com.au has reported over the past 12 months, has watched as sales volumes in North America have slid — due principally to the Global Financial Crisis and its aftermath. Bad publicity resulting from high-profile safety recalls may not have helped the situation, although sales didn't appear to have been affected. Over the past year, the major contributor to Toyota's sales shortfall has been the earthquake and tsunami in northern Japan.

Because Toyota has endured unforeseeable misfortune this year, the Japanese company may well recover the lead from Volkswagen next year, says IHS Automotive, based on a projected sales volume of 8.4 million vehicles. J.D. Power predicts that Volkswagen will keep ahead of Toyota by around 50,000 units.

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