VW sells most vehicles in first half 2015
#1
Lexus Fanatic
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iTrader: (20)
VW sells most vehicles in first half 2015
interesting...
Volkswagen surpassed Toyota as the world's largest automaker in the first half of 2015, fulfilling a long-held goal, despite a sales slump in the U.S.
Volkswagen sold 5.04 million vehicles in the first six months of the year, edging Toyota's 5.02 million. General Motors, once the world's biggest automaker by a long shot, is now firmly entrenched in the No. 3 slot. It has not yet released its official first-half stats.
The title of world's largest automaker is largely a symbolic victory. But it does serve as an effective gauge of how global strategies are unfolding.
"It’s certainly bragging rights, and being able to communicate that they’re the largest automaker in the world is a powerful statement," said Tom Libby, an IHS Automotive analyst. "It’s certainly something they’re going to promote."
Volkswagen CEO Martin Winterkorn has long wanted the company to seize the No. 1 spot by 2018, but a spokeswoman declined to plant a triumphant flag on the news.
"We do not comment on the figures of other automakers," Volkswagen spokeswoman Jeannine Ginivan said in an email. "The goal of the Volkswagen Group is to focus on qualitative growth and not being No. 1 in sales."
Whether the German automaker can retain the No. 1 title for the full year is its next hurdle.
"They’ve been very aggressive and open about their desire to be No. 1, so it speaks to them executing their plan," Libby said.
Boosting volume has its benefits. It brings greater manufacturing scale, allowing the company to spread costs over a wider production footprint and thus bolster profits. But it can also take a toll on quality and profit margins, particularly if automakers raise incentives to give dealers a jolt.
"I think the race for volume is the wrong race. I think the race for profitability is the right race," AutoTrader.com analyst Michelle Krebs said. "So if I were running an automaker that’s the number I would be looking at. Because sales volume you can buy."
Volkswagen's ascension to the top spot is not a particularly devastating blow to Toyota, which remains immensely profitable and retains strong global market share.
Toyota's operating profit margin for its 2015 fiscal year, which ended March 31, was 10.1%, making the Japanese automaker the envy of the industry. Volkswagen's global operating profit margin was 6.3%.
"Sales volumes or being the largest global automaker has never been a goal for Toyota," Toyota spokesman Scott Vazin said in an email. "Our focus is on getting our products and services right for our customers and ensuring we are exceeding their needs and expectations. We congratulate VW on achieving its stated goal."
Despite Volkswagen’s global sales gains, it has struggled in the U.S. Industry experts say the namesake Volkswagen brand lacks enough selection and has lagged on quality in the world’s most lucrative car market.
U.S. sales of the Volkswagen brand fell 10% in 2014, despite a 5.9% gain in overall industry sales. For the first six months of 2015, Volkswagen brand sales fell 2.6%, compared to a 4.4% increase for the overall industry.
By contrast, U.S. sales for the Toyota brand rose 5.8% in 2014 and 5.2% for the first half of 2015.
In the 2015 J.D. Power and Associates Initial Quality Study, which examines new vehicles, Volkswagen's namesake brand ranked 24th out of 33 brands sold in the U.S.. The Toyota brand was 10th.
To be sure, though, the U.S. market has reflected one of Volkswagen's only significant slip-ups. The company has claimed the top spot in China, the world's largest vehicle market, and remains dominant in Europe.
AutoTrader.com's Krebs joked that the U.S. is like "an emerging market" to Volkswagen. which hasn't introduced new vehicles quickly enough in the U.S. and has failed to capitalize on the crossover movement.
"Volkswagen’s story in the U.S. is so different than their story globally," she said.
Still, the German automaker's global sales for the first half of 2015 fell 0.5% compared to the previous year, as tough economic conditions took a toll in foreign markets such as South America and Russia. The company's China sales fell 3.9% through June.
Toyota’s global sales fell 1.5% for the same period.
http://www.usatoday.com/story/money/...2015/30772509/
Volkswagen sold 5.04 million vehicles in the first six months of the year, edging Toyota's 5.02 million. General Motors, once the world's biggest automaker by a long shot, is now firmly entrenched in the No. 3 slot. It has not yet released its official first-half stats.
The title of world's largest automaker is largely a symbolic victory. But it does serve as an effective gauge of how global strategies are unfolding.
"It’s certainly bragging rights, and being able to communicate that they’re the largest automaker in the world is a powerful statement," said Tom Libby, an IHS Automotive analyst. "It’s certainly something they’re going to promote."
Volkswagen CEO Martin Winterkorn has long wanted the company to seize the No. 1 spot by 2018, but a spokeswoman declined to plant a triumphant flag on the news.
"We do not comment on the figures of other automakers," Volkswagen spokeswoman Jeannine Ginivan said in an email. "The goal of the Volkswagen Group is to focus on qualitative growth and not being No. 1 in sales."
Whether the German automaker can retain the No. 1 title for the full year is its next hurdle.
"They’ve been very aggressive and open about their desire to be No. 1, so it speaks to them executing their plan," Libby said.
Boosting volume has its benefits. It brings greater manufacturing scale, allowing the company to spread costs over a wider production footprint and thus bolster profits. But it can also take a toll on quality and profit margins, particularly if automakers raise incentives to give dealers a jolt.
"I think the race for volume is the wrong race. I think the race for profitability is the right race," AutoTrader.com analyst Michelle Krebs said. "So if I were running an automaker that’s the number I would be looking at. Because sales volume you can buy."
Volkswagen's ascension to the top spot is not a particularly devastating blow to Toyota, which remains immensely profitable and retains strong global market share.
Toyota's operating profit margin for its 2015 fiscal year, which ended March 31, was 10.1%, making the Japanese automaker the envy of the industry. Volkswagen's global operating profit margin was 6.3%.
"Sales volumes or being the largest global automaker has never been a goal for Toyota," Toyota spokesman Scott Vazin said in an email. "Our focus is on getting our products and services right for our customers and ensuring we are exceeding their needs and expectations. We congratulate VW on achieving its stated goal."
Despite Volkswagen’s global sales gains, it has struggled in the U.S. Industry experts say the namesake Volkswagen brand lacks enough selection and has lagged on quality in the world’s most lucrative car market.
U.S. sales of the Volkswagen brand fell 10% in 2014, despite a 5.9% gain in overall industry sales. For the first six months of 2015, Volkswagen brand sales fell 2.6%, compared to a 4.4% increase for the overall industry.
By contrast, U.S. sales for the Toyota brand rose 5.8% in 2014 and 5.2% for the first half of 2015.
In the 2015 J.D. Power and Associates Initial Quality Study, which examines new vehicles, Volkswagen's namesake brand ranked 24th out of 33 brands sold in the U.S.. The Toyota brand was 10th.
To be sure, though, the U.S. market has reflected one of Volkswagen's only significant slip-ups. The company has claimed the top spot in China, the world's largest vehicle market, and remains dominant in Europe.
AutoTrader.com's Krebs joked that the U.S. is like "an emerging market" to Volkswagen. which hasn't introduced new vehicles quickly enough in the U.S. and has failed to capitalize on the crossover movement.
"Volkswagen’s story in the U.S. is so different than their story globally," she said.
Still, the German automaker's global sales for the first half of 2015 fell 0.5% compared to the previous year, as tough economic conditions took a toll in foreign markets such as South America and Russia. The company's China sales fell 3.9% through June.
Toyota’s global sales fell 1.5% for the same period.
http://www.usatoday.com/story/money/...2015/30772509/
#3
Lexus Fanatic
Good post, bit.
Hmmm........where have we seen that before from over-expansion too quickly? Toyota? GM?
Boosting volume has its benefits. It brings greater manufacturing scale, allowing the company to spread costs over a wider production footprint and thus bolster profits. But it can also take a toll on quality and profit margins, particularly if automakers raise incentives to give dealers a jolt.
Last edited by mmarshall; 07-28-15 at 07:28 PM.
#4
Moderator
iTrader: (16)
Toyota's operating profit margin for its 2015 fiscal year, which ended March 31, was 10.1%, making the Japanese automaker the envy of the industry. Volkswagen's global operating profit margin was 6.3%.
"Sales volumes or being the largest global automaker has never been a goal for Toyota," Toyota spokesman Scott Vazin said in an email. "Our focus is on getting our products and services right for our customers and ensuring we are exceeding their needs and expectations. We congratulate VW on achieving its stated goal."
"Sales volumes or being the largest global automaker has never been a goal for Toyota," Toyota spokesman Scott Vazin said in an email. "Our focus is on getting our products and services right for our customers and ensuring we are exceeding their needs and expectations. We congratulate VW on achieving its stated goal."
VW needs to hurry up not the 7-Passenger CUV for the US market, and possibly a revised Tiguan/Toureg to spur US sales
#6
Lexus Test Driver
VW is a mixed bag. I have a customer who owns a 2013 Jetta SE with the 2.5 and he hates the whole car. Says it's tinny and gutless. Then I've talked to another who loves his newer Passat. Maybe it's a Mexico thing.
#7
Hence our subjective opinions are affected by what we see in our markets.
Objectively, there is little chance of Toyota being #1 in next 3 years again... simply because they are not aggressive about sales but rather on profits. Their new factories will go on-line only in 2018, and by then VW is building even more.
However, on the other hand, Toyota is massively more profitable than VW. VW has a huge problem with profitability of non-luxury brands such as VW, Skoda, Seat... estimated profitability is only 2% vs 9% for Toyota. VW has focused on volume vs profit and Toyota has done the opposite... we just heard that they delayed Lexus Chinese factory for few years and they have done the same all these years for Toyota brand.
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#8
Toyota does need to figure out how to sell more cars in China though, in the next 20 years it will become a much larger market than the US.
Toyota(and other Japanese makes) suffer an image problem in China. If you don't know anything about Chinese culture, there is a huge portion of the population that still hasn't forgiven Japan for invading them during the war and would never buy anything Japanese made. Anti-Japan sentiment is pretty well ingrained in Chinese culture.
Toyota(and other Japanese makes) suffer an image problem in China. If you don't know anything about Chinese culture, there is a huge portion of the population that still hasn't forgiven Japan for invading them during the war and would never buy anything Japanese made. Anti-Japan sentiment is pretty well ingrained in Chinese culture.
#10
Lexus Fanatic
iTrader: (1)
Toyota has huge US sales but weaker Chinese sales.... VW has gigantic Chinese sales and extremely bad US sales.
Hence our subjective opinions are affected by what we see in our markets.
Objectively, there is little chance of Toyota being #1 in next 3 years again... simply because they are not aggressive about sales but rather on profits. Their new factories will go on-line only in 2018, and by then VW is building even more.
However, on the other hand, Toyota is massively more profitable than VW. VW has a huge problem with profitability of non-luxury brands such as VW, Skoda, Seat... estimated profitability is only 2% vs 9% for Toyota. VW has focused on volume vs profit and Toyota has done the opposite... we just heard that they delayed Lexus Chinese factory for few years and they have done the same all these years for Toyota brand.
Hence our subjective opinions are affected by what we see in our markets.
Objectively, there is little chance of Toyota being #1 in next 3 years again... simply because they are not aggressive about sales but rather on profits. Their new factories will go on-line only in 2018, and by then VW is building even more.
However, on the other hand, Toyota is massively more profitable than VW. VW has a huge problem with profitability of non-luxury brands such as VW, Skoda, Seat... estimated profitability is only 2% vs 9% for Toyota. VW has focused on volume vs profit and Toyota has done the opposite... we just heard that they delayed Lexus Chinese factory for few years and they have done the same all these years for Toyota brand.
Those big discounts has cause less resale value on trade ins too.
Last edited by Joeb427; 07-29-15 at 06:42 AM.
#11
Lexus Fanatic
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interesting comments... does seem the big factor here is china. their growing prosperity (despite stock bubble) has meant they need millions more cars, and i guess someone had to step in to fill the demand and it looks like toyota didn't and/or wasn't wanted there.
toyota as has been said though, is more proftable - their 10% margin may be better than vw's 6 but both really crazy low when you compare to a tech company like apple, lol
as younger people in developed countries in choked cities show less and less interest in cars though, and services like uber become even bigger, car demand will drop except where markets like china and india are still expanding due to increasing prosperity.
toyota as has been said though, is more proftable - their 10% margin may be better than vw's 6 but both really crazy low when you compare to a tech company like apple, lol
as younger people in developed countries in choked cities show less and less interest in cars though, and services like uber become even bigger, car demand will drop except where markets like china and india are still expanding due to increasing prosperity.
#12
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