VW is top-selling carmaker in first half as Toyota slips

Toyota Motor reported a drop in first-half vehicle sales following a series of production stoppages, falling behind Volkswagen Group which was the world’s top-selling automaker in the first six months despite its emissions scandal.

Toyota’s global sales including Lexus and Daihatsu brands slid 0.6 percent in January-June to 4.99 million vehicles, down from 5.02 million in the same period last year, the company said in a statement on Thursday.

VW Group said on Wednesday it delivered 5.12 million vehicles in the same period, a 1.5 percent rise.

Both automakers count heavy truck sales among the numbers.

VW Group sales have so far not taken a beating from its diesel-rigging scandal, sparked by its admission in September that it installed illegal software to mask toxic emissions on about 11 million diesel vehicles worldwide.

While sales of its mass-market VW brand have suffered, this has been more than offset by strong demand for luxury Audi and Porsche models as well as Czech brand Skoda.

VW said on Thursday it expected full-year sales to come in slightly above last year’s 9.93 million deliveries, as demand in China and Western Europe outweighs declines in the Americas and Russia.

Although the emissions scandal has tarnished its reputation and triggered a multitude of lawsuits, VW has maintained sales in part by offering incentives to buyers in the United States and other markets while it repositions its business by investing in electric cars and on-demand transport services.

General Motors, the largest U.S. automaker, is third in global sales rankings, with six-month sales of 4.76 million vehicles, down 1.2 percent from a year earlier.

Toyota’s woes

Having been the world’s best-selling automaker for four consecutive years through 2015, Toyota has suffered this year from a hit to Japanese production after an earthquake in April damaged a plant operated by a key supplier, halting production at many of its lines across the country for weeks.

Before that, production at domestic assembly plants ground to a halt for a week in February after an explosion at one of the automaker’s steel suppliers led to a shortage of parts.

For the month of June, sales of Toyota vehicles fell 1.1 percent to 881,000.

Demand for the newly redesigned Prius hybrid has slumped in a U.S. market dominated by trucks and SUVs. Despite introducing a new-look sedan model featuring improved mileage and a higher-tech interior, U.S. deliveries of the Prius plunged 25 percent in the first half, as low fuel prices boosted demand for trucks and SUVs.

“We’re trying to sell cars in a truck industry,” Paul Holdridge, vice president of Toyota division sales in the U.S., said on a conference call earlier this month to discuss the company’s 2.7 percent drop in first-half deliveries. “With gas prices on hybrid vehicles, it’s making it a challenge for us to sell the Prius.”