Volkswagen AG is all set to overtake Toyota Motor Co and General Motors Corp as the world's top carmaker in the first quarter of 2009, helped in large measure by the German government's incentives for buyers of new cars.
VW also increased its share of global passenger car market by 130 basis points to 11 per cent despite a 11 per cent fall in deliveries to customers at 1.39 million vehicles.
In contrast, Toyota had predicted a 47 per cent drop in its global first-quarter sales to 1.23 million units against VW projected 10 per cent decline in sales.
But that projected drop has been more than offset by the sharp upturn in the Chinese and German markets. VW's output for the first three months of 2009 would still be over 1.4 million units.
Volkswagen -- with its nine brands including Audi, Skoda, Seat and truckmaker Scania -- is in the markets that are currently growing while Toyota is still in the falling markets.
The deepening recession and credit crisis have crippled demand in Toyota's top markets, with US sales falling 38 per cent and Japan sliding 24 per cent in January-March.
In contrast, deliveries of Volkswagen group brands in Germany rose 4.5 per cent to about 251,500 vehicles during the quarter. More than 160,000 new orders were booked after government started subsidies for scrapping of old cars to buy new ones.
Volkswagen is also benefiting from government stimulus plans that have boosted demand in China and Brazil as well.
The three markets – Germany, China and Brazil – are the biggest markets that accounted for half of all Volkswagen group sales in the first quarter of 2009.
Toyota, on the other hand, has seen sales fall every month of this year in China, its third-biggest market.
VW also seized greater control of even weak markets like Russia. Despite a 39 per cent contraction in overall Russian demand, Volkswagen grew its volume by 14 per cent, making it the fourth-largest manufacturer in the country.
Volkswagen, which sold just 6.3 million vehicles against Toyota's 9 million in 2008, aimed to surpass Toyota and General Motors Corp as the world's No1 seller by 2018.
Toyota, which will disclose its worldwide first-quarter vehicle sales next week, is counting on a third-generation Prius hybrid car due for roll-out next month to jump-start sales. It will launch 16 new models in Europe this year following a product drought last year.
Volkswagen is looking to the sixth generation of its flagship Golf hatchback and a relaunched Polo subcompact to drive sales. VW has also moved up in stock value ranking, grabbing the No2 spot with $100 billion, but still far behind Toyota's $133 billion.