Japan's Toyota Motor Corp on Tuesday predicted further robust growth in 2008 after racing past US rival General Motors this year to become the world's top producing automaker.
Strong growth in emerging markets such as China, Russia and Brazil will help to lift vehicle sales by five percent next year, despite an expected sluggish performance in the United States due to a slowing economy, Toyota said.
The Japanese auto giant said it expects to sell 9.85 million vehicles next year, up from a previous target of 9.8 million. "Because of the US housing slump and the subprime loan problems we expect the US market to remain at the same level as this year," said Toyota president Katsuaki Watanabe.
In Japan, "the market is expected to remain at a rather weak level," he added. On the other hand, sales in fast-growing economies such as China, Brazil and Russia are expected to show continued solid growth, he told reporters.
"Toyota intends to strengthen its production structure in those emerging countries," he said at a traditional year-end press conference in the automaker's hub of Aichi prefecture in central Japan.
Toyota estimated that its global sales rose six percent to 9.36 million in 2007, including subsidiaries truckmaker Hino Motors Ltd and small car specialist Daihatsu Motor Co General Motors, which does not give sales forecasts, has been the world's best-selling automaker for seven decades with an all-time record of selling 9.55 million vehicles in 1978.
But it has been shutting several factories and slashing tens of thousands of jobs in an attempt to turn around its recent poor performance, which saw it slump to a record loss of 39 billion dollars in the third quarter of 2007.
Toyota has been neck-and-neck with GM in sales in the current year and it is still unclear which one will end 2007 as the world's top selling automaker. Analysts said that while Toyota's targets for next year appeared achievable, the wildcard is the US market where sales could prove weaker than it expects.
"We think that the (US) market will be substantially down" next year, said Credit Suisse auto analyst Koji Endo. A stronger yen and a less favourable product mix could also weigh on the company's overall performance, he said.
"Toyota's profits have increased for the past seven or eight years, but for the first time they could go down next year," Endo warned. In terms of production, it is already virtually certain that Toyota will snatch GM's crown of the world number one for 2007. Toyota said that it expects output of 9.51 million vehicles this year, while GM expects to produce 9.259 million as it undergoes major restructuring.
Toyota has been careful not to gloat about its success in the United States, fearing a protectionist backlash of the type seen when Japanese automakers first seriously penetrated the market in the 1980s.
"Next year we have the presidential election in the US. The subprime problem is already a big issue for Toyota. On the top of that, they don't want to have a political issue. They're trying to have a low profile," said Endo. Next year Toyota expects to boost global output by five percent to 9.95 million vehicles.
A pioneer of eco-friendly hybrids, Toyota has won an especially strong following in the United States, where sky-high prices at the pump have boosted demand for the Japanese firm's smaller vehicles. But amid signs of economic trouble in the United States, Toyota has recently been focusing more on emerging economies for its future growth. "Toyota is facing new problems this year, which are the high oil price and the US subprime mortgage woes. These are serious risks for the automaker," said Mitsuyuki Odaira, an auto analyst at Tokai Tokyo Research Center.
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