Toyota Retains a Coveted Crown

The Japanese automaker recently announced the resignation of its CEO to adjust its strategy in EVs.

Regarding electric vehicles, Toyota has plenty more to say.

The Japanese automaker is outdistanced by its competitors in the electric vehicle segment. It only recently recognized that its strategy may not have been the right one. 

Indeed, last week, the manufacturer of the Camry sedan announced the resignation of its CEO, Akio Toyoda, grandson of Founder Kiichiro Toyoda. The company said it would "implement changes to its executive structure effective April 1, 2023, and changes to its board of directors effective the date of its 119th ordinary general shareholders' meeting."

Toyoda, 66, will thus step down effective April 1. He will be succeeded by Koji Sato, 53, Toyota's chief branding officer and head of the Lexus premium brand.

The change also suggested that Toyota was implicitly acknowledging that its green-vehicle strategy came up short. Toyoda was seen holding back the automaker from fully embracing electric vehicles.

Last October, the company said it would invest $70 billion in electrified vehicles, with half that figure in 100% electric vehicles. Unlike other manufacturers, the group's carbon-emissions-reduction strategy was not centered on battery electric vehicles.

Toyota Sold 10.5 Million Vehicles in 2022

At the time, Toyoda  (TM) - Get Free Report doubled down by saying that it would unveil a lineup of electrified vehicles that run on liquid hydrogen and traditional rechargeable lithium-ion battery packs.

This position made Toyoda the wrong leader to lead the hybrid Prius maker's offensive against Tesla  (TSLA) - Get Free Report and leading Chinese automakers in electric vehicles like Byd  (BYDDY)  and Nio  (NIO) - Get Free Report. Investors also seem to be calling on automobile groups to show clearly how they plan to compete in the electric sector. 

With his reservations about electric vehicles, Toyoda had therefore become the wrong messenger. 

Meantime, while Toyota waits to find out what Sato's strategy will be, the company can console itself with a coveted crown. For the third year in a row the company holds the title of the world's leading car manufacturer based on sales.

Last year Toyota sold nearly 10.5 million vehicles, roughly stable (-0.1%) compared with 2021, the automaker announced in a news release on Jan. 30. About 82% of sales were made outside Japan. Figures include sales of Toyota, Lexus and those of Daihatsu Motor Co. and Hino Motors Ltd.

Toyota is 27% ahead of Volkswagen  (VWAGY) - Get Free Report, which sold 8.3 million vehicles in 2022. The VW figure was down 7% from 2021. Last year was problematic for Volkswagen, which has been hurt by supply shortages caused by the Russian war in Ukraine.

Toyota passed the German group in 2020 and has since retained the symbolic crown.

GM Rules Sales in the U.S. 

The Japanese manufacturer, however, lost the title of leading automobile group in the U.S. by sales. The firm sold fewer vehicles than General Motors  (GM) - Get Free Report, which sold 2,274,088 vehicles, 7.9% more than the 2,108,458 Toyota sold.

"In 2022 (January to December), despite the impact of production constraints caused by the spread of covid-19, increased demand for semiconductors, and other factors, global sales were at the same level year-on-year as a result of solid demand centered around Asia," the company said.

It warned that "the situation remains difficult to predict due to semiconductor shortages and covid-19. However, we will continue to carefully monitor the parts-supply situation and minimize sudden decreases in production as much as possible while making every effort to deliver as many vehicles to our customers at the earliest date."

In November Toyota revised its production forecast for the current financial year through the end of March, to 9.2 million vehicles from 9.7 million. 

In 2022, Toyota's production decreased 5.3%. to 10.6 million units. 

The parts shortage remains a major headache: It has forced the carmaker to suspend operations at its plant in the Czech Republic from Jan. 31 through February.

Although Toyota is the group selling the most vehicles, it is not the automaker with the highest market capitalization. This title goes to Tesla  (TSLA) - Get Free Report, which had a market value of $534 billion at last check. Toyota's market value is $199 billion.