Toyota vs GM: How Car Buyers Benefit

By Joel Arellano | July 26, 2012
Most car shoppers care little which automaker is number one in sales worldwide. They're more interested in getting the best bang for their hard-earned buck. But buyers benefit from such fierce competition, either directly or indirectly, especially when it involves the big boys like General Motors and Toyota. GM and Toyota have been locked in a race for carmaker numero uno for decades now. GM narrowly held the coveted position until 2008, when Toyota took the gold. GM then regained the top spot as Toyota, as well as other Japanese automakers, recovered from the devastating Japanese earthquake and tsunami of 2011. Now Toyota looks to reclaim the throne. According to Bloomberg, sales of Toyota vehicles rose over 30-percent in the first half of 2012. Contrast that to GM, which saw a modest near 3-percent increase during that same period of time. States Jeff Schuster, VP for LMC Automotive, “Toyota has bounced back stronger than expected. We are now at the critical mid-year point in the race, and given Toyota’s lead, it will be very difficult for GM to catch Toyota.” Indeed. But analyst Rebecca Lindland of IHS Automotive believes the huge jump is only temporary, built from pent-up demand by consumers during the tsunami crisis. Toyota is riding the released pressure as much as it can, offering incentives to nearly $1,950 per vehicle back in June. The Japanese automaker definitely noticed how sales of the all-new Chevrolet Cruze, which debuted last year, exploded to over 231,000 units sold from a modest near 25,000 in 2010. The Chevy Cruze is a direct competitor to Toyota's Corolla subcompact. With Toyota's recovery, sales of the Cruze have dropped nearly 7.5 percent so far this year. Automotive.com's take: Don't look for incentives to end. While the automakers have recovered from bankruptcies and natural disasters may be over for now, GM and Toyota are now releasing their 2013 models. Look for more incentives from dealerships as they look to clear their 2012 stock from the floor. Source: Bloomberg
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