Toyota's U.S. Sales Surge As General Motors Stalls
Wednesday, October 4, 2006
Toyota Motor Corp. yesterday reported booming U.S. sales in September, setting a pace that continues to rattle the world's other major auto companies.
Sales of Toyota vehicles soared 25 percent last month compared with last September. General Motors Corp.'s sales dropped 3 percent, and the automaker announced more production cuts for later in the year.
The sales figures were released as GM's board of directors met to discuss the status of the talks on a possible alliance between GM, Nissan Motor Co. and Renault SA. Battling the growing global clout of Toyota has emerged as a central theme in the discussions.
Billionaire investor Kirk Kerkorian is pressing GM to step up the negotiations even as the company's executives remain wary of a big new project that they say could divert attention from their restructuring plans. The talks are scheduled to end in mid-October.
Matthew D. Collins, a transportation industry analyst at St. Louis-based Edward D. Jones & Co., said that in the short-term GM will benefit from falling gas prices and its updated sport-utility vehicles and pickup trucks.
"You put those factors together, and GM could be in better shape than most would have expected," Collins said. "What that means is less urgency to do a deal with Renault and Nissan."
Analysts say Toyota's sales were lifted by truck discounts and surging sales of small cars, including models from Scion and Lexus. Jim Lentz, a Toyota executive vice president, ascribed the company's gains to the "breadth of our lineup."
Toyota reported sales strength in many areas. Sales of the Prius hybrid rose 28 percent, to 10,492. The automaker also sold more Tundra pickups and Sequoia SUVs.
Jesse Toprak, an analyst with Edmunds.com, said incentives helped boost sales of Toyota's trucks. "Toyota certainly is keeping their momentum," he said. "They will continue to grow."
Toyota has increased its sales and profit forecasts this year, and some analysts say it is on the verge of overtaking GM as the world's No. 1 automaker.
GM and Ford Motor Co., meanwhile, are moving through a brutal restructuring period that includes tens of thousands of job cuts and dozens of plant closures.
Other Japanese automakers reported weak U.S. results. Honda Motor Co.'s sales declined 4 percent, and sales at Nissan were down nearly 6 percent.
Among the U.S. automakers, Chrysler Group, the Detroit-based division of DaimlerChrysler AG, reported a nearly 4 percent decline in sales. Ford sales rose almost 5 percent in the month, a break from an otherwise weak performance so far this year.
Overall, U.S. consumers purchased 1.35 million new cars, pickups, SUVs and minivans in September, up 1.9 percent from last September.
Some analysts have questioned the rationale behind an alliance of GM, Nissan and Renault. Nissan and GM have overlapping vehicle lineups in the United States, which seem to make them better suited to be rivals than partners. A similar problem exists in Europe. And GM has a corporate culture all its own, rooted in the automaker's long-held spot as the world's No. 1 automaker.
But other executives in the industry say Toyota is closing in fast. High-level executives from Renault argued in Paris last week that a GM-Nissan-Renault alliance would give the three companies a defense against the strength of Toyota. Renault executives said they had seen enough potential synergies among Nissan, Renault and GM to justify a partnership.