Toyota’s chairman expressed his shame over recent scandals involving the company’s subsidiaries as Toyota announced a new global record of 11.2 million vehicle sales across its brands last year. Retaining its position as the world’s top-selling automaker for the fourth consecutive year, Toyota’s success can be attributed to recovering demand and easing chip shortages. However, while Toyota and Lexus brands saw global volume sales of 10.3 million units, Daihatsu, which is involved in a rigged safety test scandal, experienced a decline in growth. Hino, a truck and bus-maker, also faced a nearly 10 percent drop in volume sales due to a scandal related to rigged tests of its engines in Japan. In response to testing irregularities at an affiliate, Toyota Industries, Toyota suspended shipments of 10 models that use diesel engines. At a press conference, board chairman Akio Toyoda apologized and took responsibility for the misconduct, expressing deep regret for the troubles and worries caused to customers and stakeholders. Recognizing the need to regain customer trust, Toyoda pledged to lead a transformation within the company.
Toyota’s total vehicle sales for the year increased by 7.2 percent compared to the previous year, reaching 11.2 million units. In comparison, Germany’s Volkswagen Group sold 9.2 million units, experiencing a 12 percent growth. South Korea’s Hyundai-Kia secured the third position with 7.3 million units sold, representing a 6.7 percent increase. While Toyota leads in terms of total vehicle sales, Elon Musk’s Tesla remains the market leader in terms of market value. Toyota attributed its success to solid demand in each region and the easing of semiconductor shortages. The combined sales of Toyota, Lexus, Daihatsu, and Hino brands surpassed Toyota’s previous record of 10.7 million units set in 2019.
The scandals involving Toyota’s subsidiaries may have potential repercussions on the company’s overall reputation, particularly concerning corporate governance and ethical practices. However, the millions of satisfied Toyota, Lexus, Daihatsu, and Hino vehicle owners contribute to strong consumer confidence, which is a valuable asset for the company. Toyota has been slower to invest in electric vehicles (EVs) compared to its competitors, focusing more on hybrids. In 2023, Toyota sold only 104,018 EVs, while Tesla sold 1.81 million and China’s BYD sold 1.57 million. However, Toyota plans to introduce an electrified version for every Toyota and Lexus model globally by 2025 and aims to sell 1.5 million EVs annually by 2026 and 3.5 million by 2030. Toyota recently announced plans to expand an electric battery plant in North Carolina. Achieving the 2026 EV sales target may prove challenging due to slower progress in EV sales and the recent backlash against battery-powered vehicles. The feasibility of the goal depends on various factors such as technological advancements, market demand, regulatory environment, and Toyota’s production and innovation capabilities.
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