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China's largest dealer body pushes back against foreign automakers over huge inventories

Do not think for a second that automakers forcing inventory on dealers in order to pad the numbers is a ruse known only in the US. Stories of individual brands have hinted at the trouble Chinese dealerships are having trying to move units as the country's economic growth remains hot but comes off the boil, like the one revealing that 95 percent of Toyota-FAW showrooms are losing money. Yet Toyota isn't the only culprit, and the issue has become so dire that the China Automobile Dealers Association (CADA), the largest dealer body in the country, has written to the government to complain. Chinese car sales are expected to close out the year with an annualized growth of six-percent, down from last year's 14 percent when targets were set, while in the background the pace of overall economic expansion is the slowest its been since the early nineties. Automakers, shipping cars on schedule to make their earlier targets, have blown up inventories such that they are an average of 1.8 times monthly sales, when the preferred multiplier is from 0.9 to 1.2. According to the CADA, the price wars and necessary incentives mean that only 30 percent of dealers are operating in the black. That number is down a whopping forty percent since 2010. In response, Toyota has already said it will not make its 2014 target of 1.1 million cars sold. We're a long way from 2012, when Toyota planned on selling 1.8 million cars in China in 2015, a target that's now as realistic as a manticore. BMW, Honda and Nissan have erased numbers on their spreadsheets, too; BMW growth dropped from 20 percent to 8 percent midyear after it began "reducing wholesale supplies," and Honda has been reworking its plans as sales have decreased each of the past six months. It's a big deal for Chinese dealers to begin protesting publicly, the CADA saying, "In the past, dealers were angry, but dared not speak out. But now, they have to shout because the situation is getting so unbearable." With six-percent growth forecast for next year and dealers unwilling to remain underwater, The Year of the Sheep coming in 2015 could portend meaning beyond the zodiac. News Source: ReutersImage Credit: AP Photo/Andy Wong BMW Honda Nissan Toyota Car Buying Car Dealers

Toyota holds onto crown of World's Largest Automaker

Although there were hints and allegations that the Volkswagen Group might have taken the global sales crown for 2014, the final tally puts Toyota at the top with 10.23 million sales in 2014. We should really say it keeps Toyota at the top, since that makes three years in a row the Japanese company has been No. 1. Volkswagen Group came in second with 10.14 million units sold, General Motors in third with 9.92 million units sold. This the first time for both Toyota and Volkswagen to pass 10 million sales in a single year. Toyota, including its Hino and Daihatsu divisions, did it with a three-percent increase in company-wide sales on the back of strong demand in Japan and the US. Its strength in developed markets might be the reason it loses the title this year, though; Toyota forecasts a two-percent gain in sales outside of Japan, but a nine-percent drop in its home market because of a new consumption tax that encouraged buyers to purchase before the end of last year. On top of that, turmoil in Southeast Asian economies like Thailand and Indonesia depressed sales in 2014 and they're facing more headwinds. The company envisions 10.15 million sales in 2015. Volkswagen, on the other hand, "has a jet engine strapped to its back called 'China,'" where Toyota is out-of-sorts. Volkswagen Group sales fell 2.9 percent in the US last year, while Toyota gained 6.2 percent here. But Volkswagen roped in 3.7 million sales in China, a 12-percent increase. Toyota enjoyed a huge bump of 12.5 percent in China, but that only got it to 1.03 million units, missing its yearly target and leading to trouble with its Chinese dealers over unsold inventory. With Toyota on the Chinese sidelines while Volkswagen guns for No. 1 status and pledges more production capacity in China – sales there are expected to top 25 million units this year – it looks like this could be the year the VW Group takes over the lead. That would be three years ahead of its original target of 2018. An analyst in Japan said Toyota is more focused on "keeping profitability than chasing numbers" – profitability is an issue for VW right now – so Toyota might not be back at the top "for [the] coming years." News Source: Bloomberg, Automotive News - sub. req. Earnings/Financials GM Toyota Volkswagen Car Buying Daihatsu sales volkswagen group

Toyota updates Euro-market GT86 suspension, appearance

While we were busy ogling the Scion FR-S Release Series 1.0 with its Yuzu yellow paint and a workover by Toyota Racing Development, and the Japanese Toyota 86 buyers were trying out their Playstation-compatible Sports Drive Logger telemetry system, the European 2015 Toyota GT86 got fitted with some new parts of its own. New on next year's model are stiffer mounts for the front suspension and rear shock absorbers, and new shocks in the back for better damping and less friction. Toyota says the result is sharper steering and less body roll.
Inside, the instrument panel and center console get decorated with a "carbon-fiber motif." There are new shades of pearl white and silver to dress up the outside, and the roof gets a shark-fin antenna for sharper looks and aero. It goes on sale this summer, and you can read everything we just told you in the press release below. We've reached out to Scion to see if we'll get the same upgrades on the FR-S this summer, too, company PR rep Nancy Hubbell telling us, "The European changes are among those being considered for the US model FR-S and we'll have final confirmation soon."