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Business

VW knocks Toyota from perch atop global car market

Volkswagen took over the top sales spot during the first half with its signature Passat and other models.

FRANKFURT, Germany -- Germany's Volkswagen became the world's biggest automaker for the first time, selling 5.04 million cars to surpass Japan's Toyota Motor in the January-June period.

     Strong European sales drove the company to the top, according to figures released by automakers through Tuesday, but lagging Chinese and Brazilian markets brought volume down by half a percentage point on the year. Toyota's sales for the half came in at 5.02 million vehicles. VW could fall back in sales rankings for the year, however, as auto markets continue to shift.

     U.S. automaker General Motors came in at No. 3. Sales dropped 1.2% to 4.86 million cars during the half as the South American market slackened.

     VW's sales in Europe edged up 4% to 2.11 million, accounting for over 40% of the group's total. The continent's new-car market showed a year-on-year jump for the 22nd month straight, having shaken off the lingering effects of the global financial crisis. VW pushed cars to a variety of consumers, appealing to the mass market with its mainstay Volkswagen brand and meeting luxury demand with Audis and Porsches.

     China sales, however, are slow, despite VW's long-standing status as the country's largest automaker. Martin Winterkorn, chairman of the group's board of management, called the country "a big growth market" for Volkswagen, but group sales volume there fell 4% during the first half to 1.74 million, with sales of VW-brand vehicles dropping 7% to 1.39 million.

     A poor response by VW dealers to recalls "dragged down the company's brand image," said a dealer in China's southeastern province of Guangdong, hurting sales in an already slowing economy. A change in tack for the company's sales policies likely pushed down volume further as Volkswagen emphasized profits, choosing not to offer too-steep discounts in a market rife with price cuts. South American sales saw an even more precipitous fall of 23% to 300,000 vehicles.

     Volkswagen group sales volume for 2014 hit 10.14 million vehicles, second behind Toyota's 10.23 million. Toyota estimates sales of 10.15 million for 2015, leading many to suspect that Volkswagen would reign for the full year. Though the half indeed brought success, Volkswagen's sales have been falling on the year since April, showing a 4% drop in June, with the gaps growing larger.

     Toyota's first-half group sales volume, including figures from Daihatsu Motor and Hino Motors, fell 1.5% on the year. Pickup trucks and other models moved briskly in North America, but sales in Japan and developing nations lagged. Residual effects from Japan's consumption tax hike in April 2014 and an increase in the country's tax on minicars this past April pushed down overall sales at home 10% to 1.125 million vehicles.

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