VW could be top automaker in 2009

20 April 2009

WOLFSBURG, Germany: Volkswagen, the German auto manufacturer, could leapfrog Toyota to become the world's biggest carmaker by sales this year, benefiting from its success in emerging markets like China and Brazil.

While Toyota overtook the ailing General Motors to become the world's number one auto firm in 2008, Reuters argues its position could be under threat given the weakness in its core markets.

The Japanese company has previously predicted that its shipments for the first quarter would decline by 47% year-on-year to 1.23 million vehicles.

Alongside a weakening in the broader economy, this is largely due to the slowdown in its major markets of the US and Japan, where total auto sales dropped by 37% and 25% respectively in March.

By contrast, Volkswagen – owner of brands including Audi and Skoda – derived 44% of its sales from Brazil, China and Germany in 2008, and the first two of these markets, in particular, are predicted to enjoy continued expansion this year.

The China Association of Automobile Manufacturers reported that sales of domestically produced cars rose 5% to 1.1 million in March, and Volkswagen also delivered a record number of vehicles in the country during that month.

Sales levels in Brazil also rose by 16.9% year-on-year, and by 40% in Germany, in the same period, with the increase in each of these three countries partly attributed to government stimulus plans.

Koji Endo, an auto analyst at Credit Suisse, said that "Volkswagen is a big competitor for Toyota. Audi is strong, Volkswagen is strong, and they're making good use of their small cars."

VW has outlined a plan to become the world's top-selling car maker by 2018, but has also predicted that sales will fall 10% this year.

Data sourced from Reuters; additional content by WARC staff