Hard times are coming, predicts the world's largest automaker. Toyota - which captured the global sales crown from struggling General Motors during the first half of 2008 - has lowered its global sales forecast for the year, largely because it expects its first annual decline in the critical U.S. market in nearly two decades.
Last year, Toyota officials threw down the gauntlet when they predicted they would sell 9.85 million vehicles worldwide. At the time, most analysts responded by forecasting that would be enough to push the Japanese maker into the No. 1 slot. But no one counted on the slump in the U.S. and the general stagnation in many other developed markets, notably in Europe.
Now, says Toyota, it expects global sales to reach 9.5 million, this year, about 1 percent more than in 2007. But in the U.S. market, the company said in a brief statement, it will suffer its first sales decline in 17 years. When you combine the Toyota, Lexus, and Scion brands, volume is expected to total 2.44 million cars, trucks, and crossovers, compared with 2.62 million in 2007 - and the original, 2008 forecast of 2.64 million vehicles.
Toyota's 6.8 percent sales slump in the U.S. so far this year is complicated by a variety of factors. There's no question it has been hurt by the sudden, sharp decline in the American light truck market. The Japanese maker has ordered a months-long shutdown of its new Tundra pickup plant in San Antonio, and will pull additional production of the full-size truck out of another factory in Indiana. It has delayed the launch of a new plant that was supposed to build the Highlander SUV - but it will add production, there, of the popular Prius hybrid.
In fact, many analysts believe Toyota could be doing better in the States if it had more hybrids and small cars to sell. There are long lines waiting for the Prius in most of the country, and dealers typically sell the hybrid vehicles the moment a shipment arrives from the factory.
The U.S. isn't the only place Toyota is struggling. It is projecting a very small downturn in the home Japanese market for 2008. On the other hand, such slowdowns have been offset by robust demand in key emerging markets, including China, where Toyota has steadily been pushing its way into the top tier of import nameplates.