January Sales For Volkswagen & Ford Zoom, Toyota Sales Sink

By Rob May

Toyota’s recall notices have not gone down too well with the automotive world, and the customer confidence is at an all time low for the brand Toyota. And this perception has also hit other Japanese manufacturers like the Honda. Things are expected to become tougher in the coming days because the impact of these recall notices and subsequent corrections in the affected cars is expected to cause long-term brand loyalty and confidence issues for Toyota.

It was clearly anticipated that Toyota’s loss would bring gains for Volkgswagen and to a certain extent other European manufacturers. If you analyze the anatomy of Toyota’s first recall notice that happened on 24th January 2010 and affected some 2.3 million vehicles, nobody would have thought that the impact on sales of Toyota and competing automotive manufacturers will be immediate. However, this has been clearly the case. A cursory glance at the sales figures reported by Volkswagen and BMW for the month of January reveals an upside to their monthly sales.

Volkswagen has reported an increase of 41% over last year’s sales in January; it delivered 538,500 vehicles in January. Last year it had delivered 381,100 vehicles in January. You could always explain this as a part of background situation in 2009 and 2010. While, customers were really not into the spending-mode on account of deep recession, things are better in 2010. The perceived customer sentiment has been positive during January this year and this has reflected in increased number of sales for European brands like VW and BMW.

BMW also declared an upswing of 16.6% in January sales over last year. It sold 82,020 vehicles compared to 70,419 in January 2009.

During the same period, Toyota has reported a decline in sales and this is on expected lines. Toyota has reported a 16% drop in sales compared to the last year. So, if you were to consolidate the losses of Toyota, VW and BMW you can understand where all the consumers are heading. It was expected that VW in Europe and Ford in the US will be the chief beneficiaries of the debacle at Toyota. And this is turning out to be absolutely true.

A close analysis of sales for Ford indicate that its US sales increased by 25% in January. It delivered 116,534 units against 93,506 units that were delivered in January 2009. Ford clocked a 4.3% increase in sales in Europe during the same period.

This brings forward a pertinent question for the automotive industry. Is this really the end of Toyota? Or, will the world’s largest automaker resurrect its beaten image and come out trumps in 2010?

To be honest these are hypothetical questions, but for now, the reality is that Toyota will continue to suffer in the interim period or maybe the entire year. It may be lucky if it is able to arrest the downfall in the sales in coming months. What is of more significance is to understand or ask what happens to other Japanese manufacturers? While these manufacturers’ sales in China and Japan are largely going to remain unaffected or recover soon, the worries for Japanese manufacturers are too many as far as US and European markets are concerned.

Until the entire recall gets completed, there is no scope of an improvement in bruised reputation. Once the recall is successfully completed, then the company may embark on ambitious plans to recover from the impact of these recalls. In these times, it will make more sense to try and repair the damaged reputation once the company is sure that the process of recall was carried out without any consequential hassles and troubles for the Toyota’s subscribers.

And, unsurprisingly, the anxious automotive world awaits the outcome of the massive exercise of the recall. After all, we agree that a recall of this magnitude is a big challenge for Toyota and if they come out of it with success, they will have lesser worries to focus on for a long-term sustenance of the brand called –Toyota.

About the Author: Rob is an automotive expert with a penchant for writing stories based on automotive analysis of current market leaders.He also suggests using fuel cards for fuel cost conservation. You can select from different fuel card providers like Shell, Texaco, Keyfuels & Texaco.

Source: www.isnare.com
Permanent Link: http://www.isnare.com/?aid=488050&ca=Automotive

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