MUMBAI (Bloomberg) -- Toyota Motor Corp. outsold Volkswagen Group and General Motors Co. for a third straight quarter, helped by a weaker yen.
Sales at Toyota, including its Hino Motors Ltd. and Daihatsu Motor Co. units, rose to 2.58 million units in the January-to-March period, the Japanese automaker said today. Second place is too close to call as GM and VW said they sold about 2.4 million each, and the German company hasn't disclosed numbers for its MAN and Scania heavy trucks.
For President Akio Toyoda, last quarter capped what the company estimates to have been its most profitable fiscal year as Toyota projects a record 1.9 trillion yen profit ($18.5 billion), mainly because of the weaker yen. Still, the carmaker is facing a growing challenge from VW, which plans to sell as many vehicles as Toyota in 2014 by expanding in China and benefiting from a recovery in Europe.
"We expect Toyota to hold the No. 1 title in the industry until 2016 or 2017," said Masatoshi Nishimoto, an analyst at IHS automotive in Tokyo. "For Toyota to maintain the title beyond that, they may need to grow more in China."
Toyota, whose shares jumped 60 percent last year, has surrendered some of those gains this year after the yen's depreciation slowed and recall-related costs mounted. Last month, the company agreed to pay a record $1.2 billion fine in the United States for misleading consumers about safety defects during Toyota's 2009-2010 recall crisis over unintended acceleration. Separately, Toyota this month called back more than 6 million vehicles to fix a range of safety defects in one of the biggest recall announcements in automotive history.
Those headwinds have prompted analysts to scale back their earnings estimates for Toyota in the past month to below what Toyota has been forecasting. The average of 25 analyst estimates compiled by Bloomberg calls for net income to reach 1.87 trillion yen in the year ended March, which would still be a record.
Last year marked a turning point for Toyoda, who took over as president five years ago after Toyota's first annual loss in almost six decades. Following years of global recalls, natural disasters, a soaring yen and Chinese boycotts against Japanese products, Toyoda got what he wished for: a disaster-free year. The grandson of Toyota's founder has cleared out the remnants of top management he inherited when he took the helm in 2009, laid out a greater focus on emerging markets and appointed three outside directors to join the board for the first time. Toyoda is also pushing an overhaul of vehicles with an emphasis on "waku-doki" design, shorthand for the Japanese phrase for heart-racing qualities.
GM, which sat atop the auto industry in 2011, slipped to third last year behind Toyota and VW. While deliveries are rising this year -- even outselling VW in China -- GM CEO Mary Barra is under fire because the company took years to recall millions of vehicles for faulty ignition switches linked to at least 13 deaths.
Last year, GM delivered 9.71 million units, while VW's sales, which includes MAN and Scania, reached 9.73 million. Toyota remained the best-selling global carmaker in 2013 with a volume of 9.98 million.
In January, Automotive News Europe reported that Toyota predicted it would breach the 10-million milestone this year, with sales of 10.32 million. VW CEO Martin Winterkorn said last month: "There is a good chance that we will already exceed the 10 million deliveries mark this year," which would be four years ahead of his original plan.
Automotive News Europe contributed to this report