Volkswagen had a target of becoming the world’s largest car maker by 2018 but will now achieve their target much earlier as Toyota is lacking growth in China.
Toyota remained ahead of the Volkswagen Group to be the best-selling automaker worldwide in 2014 but may lose the sales title this year as sales have fallen short in China. The Japanese automaker has predicted that its global deliveries will decline by 1 percent in 2015 to 10.15 million vehicles, or just 10,000 units ahead of what Volkswagen had sold worldwide last year. Volkswagen will open a new factory this year in Changsha China, which will add to the production of 3,00,000 vehicles annually. Toyota’s main competitors being GM and Volkswagen have all their plans set for the future, while Toyota sort of doesn’t.
Toyota ranks sixth among global automakers in China, the Japanese automaker hasn’t built an assembly plant in the world’s biggest car market since 2012 and faces a self-imposed delay on new factories until next year. It will fall behind even further as Volkswagen has already stepped ahead in their expansion plans. Volkswagen plans to raise their China plant capacity to more than 4 million vehicles by 2018, which stood at 3.1 million at the end of 2013. Toyota really needs to focus on building a factory in China or else it will lead to a drop in their sales and they would be outrun by competitors.
Since the sales of Toyota are declining in China, there have been threats by its dealers that they would drop out of its network, due to a lack of profit. As many as 10 percent of dealers for one of Toyota’s China ventures could abandon the brand. Vehicle sales have showed a decline in China as there has been weak economic growth since 1990. Reports suggests that Toyota plans on saving the growth for the future and just plans on improving efficiency in their current plants. The Camry maker could just bounce back and retain its position at the top.