GM loses global sales crown after 77 years
DETROIT (Reuters) - General Motors Corp reported an 11 percent drop in global sales in 2008, allowing rival Toyota Motor Corp to surpass it as the world's largest automaker for the first time.
GM, now struggling to restructure under a $13.4 billion U.S. government bailout, had held the title as the global auto industry leader for 77 years and used the line in marketing.
But for 2008, Detroit-based GM said sales tumbled to 8.35 million vehicles, pressured by tightening credit and a slowdown that began in the United States and spread to emerging markets where GM has been stronger.
GM shares fell 26 cents or 7.4 percent to $3.24 on the New York Stock Exchange on Wednesday near midday.
Earlier this week, Toyota said its global sales for 2008 had slipped 4 percent to 8.97 million vehicles as it also battled a costly slowdown in key markets.
Both GM and Toyota downplayed the significance of the shift in market leadership.
"Share doesn't always pay the bills," Don Esmond, Toyota's senior vice president for U.S. operations, said at an industry conference when asked about Toyota capturing the No. 1 spot after years of gaining on GM.
GM and Toyota ended 2007 with a virtual tie.
GM sold 9.369 million vehicles, including those sold through SAIC-GM-Wuling, a commercial vehicle joint-venture in China in which the U.S. automaker has a minority stake.
Toyota sold 9.366 million vehicles for 2007.
GM Chief Executive Rick Wagoner had vowed to defend the company's global sales leadership, saying the title was a point of pride for the automaker.
But with GM reliant on federal funding to avoid bankruptcy, GM Chief Operating Officer Fritz Henderson said late on Tuesday that the automaker had been forced to focus on other measures of the success of its turnaround.
"I actually noticed that they passed us in market capitalization, profitability and cash flow long ago," Henderson said of Toyota.
GM, which faces an end-March deadline to demonstrate to U.S. officials that it can be made viable, has a market capitalization of just under $2 billion.
Toyota has a market value of about $117 billion. Like GM, it has had to cut North American production and delay new investment. The Japanese automaker has warned that it will post its first-ever operating loss this fiscal year. Continued...
