The spat this year over whether Ford Motor Company or Toyota Motor Corporation was the world's second-biggest vehicle maker in 2003 masked a more significant development: the inexorable rise of the Japanese group in half a century.
Whether Ford or Toyota is the larger is now almost a sideshow. Ford was ahead last year, but those days look numbered. And if history is a guide, Toyota seems destined to pass General Motors as the world's top vehicle maker, probably within a decade.
That would be something; GM has been the unchallenged No1 since it overtook Ford in 1931. That was five years before Toyota made its first car. Along the way, Toyota zoomed past all other car firms, including the largest in Europe, Volkswagen. Sales in the past 20 years show how Toyota is changing the pecking order. GM sold 8.6 million vehicles globally last year, one-third more than it did in 1980. Ford's 2003 total was about 6.7 million, which was half as much again as in 1980. But Toyota's 6.5 million last year was more than double its 1980 level.
GM's advantage may look too great to be wiped out soon, but it has already been substantially eroded. It was twice as big as Toyota in the early 1980s, but is now only one-third larger. It looks only a matter of time before the trend lines cross.
Besides, Toyota president Fujio Cho has established a target that he calls Global 15. It requires his company to achieve a 15 per cent share of the world-wide vehicle market some time during the decade beginning 2010, and the sooner the better.
To put that in perspective, GM has 14 per cent compared with nearly 11 per cent for Toyota. And Toyota always errs on the side of caution. Its plan to exceed sales of 800,000 in Europe was realised last year, two years ahead of schedule. If that is repeated globally, GM's advantage will suddenly begin to look vulnerable.
No one at Toyota is crass enough to declare that the aim is to overtake GM. That is not the Japanese way. But Toyota appears to have several key advantages over GM - and almost every other vehicle maker.
At a time when GM and Ford are static at best, Toyota is on a major world expansion drive. It is creating more manufacturing capacity in North America, central Europe, China, India and south-east Asia. Toyota's fabled production system has been widely copied, but is still regarded as the most efficient in the world, with the advantage that implies in terms of costs.
That lead then grows because of the legacy burden carried by US vehicle makers. Their health care and retirement contributions add $2,000 to the cost of every vehicle made in the United States by GM, Ford and Chrysler.
America is critical to Toyota. It is the bedrock of its profitability because of the number of cars it sells there - more than in Japan - and the profit margin on each one. Toyota even out-sold good old apple-pie Chrysler in America one month last year. Given Chrysler's problems, the switch could soon become permanent.
Toyota also remains the industry benchmark for quality and reliability. Its models are at or near the top of every customer satisfaction survey, invariably ahead of the best American, European and Korean nameplates. The implications for warranty costs and customer-retention are self-evident.
And Toyota refuses to be beaten on technology. When the group belatedly woke up to the need for modern diesel engines to win more customers in Europe, it swiftly introduced three, all-new, common-rail units and created new factories to build them. It is unlikely any other car maker could have matched that. There was another example of Toyota's rapid-reaction capability in technology at the recent Geneva motor show. It unveiled a completely revised Verso version of the Corolla because the earlier model - only two years old -had failed in the market place. The latest model hits all the right buttons.
Toyota is at the forefront of fuel-cell and hybrid powertrain development. While most other companies are at the development stage, the petrol/electric Prius saloon sets new standards in emissions and fuel economy. Ford was recently obliged to take out licences to use Toyota's hybrid and emissions technology.
Curiously, few car buyers in Britain and the rest of Europe are aware Toyota is such a powerhouse. That is probably a reflection of the group's historically dull-looking models and its innate conservatism. It abhors the flash-bang-wallop hype of its competitors, preferring to design, make and sell cars that make sense.
The worrying prospect for the region's old-established makers now is that Toyota has turned its attention to Europe. Japan's top car maker and the world's No.3 is not content with being ranked eighth in Europe.
Toyota's market share in western Europe rose from 2.5 per cent in the mid-1990s to 4.7 per cent last year. It sold 835,000 vehicles in Europe last year. Now the plan is to increase that to 1.2 million by 2010. To get there, Toyota will make small economy cars in the Czech Republic from next February with Peugeot-Citroën. A gearbox factory in Poland will make diesel engines this year. The group's car assembly plant in France has started three-shift working, a world first for the company, to meet demand for Yaris.
Toyota is also investing £135m more in its R&D centre near Brussels. But Toyota is not invincible. It initially misread the booming market for pick-up trucks in the US by selling under-powered V6s. The company now offers mighty V8 pick-ups as well. Another problem is that, because most Toyota customers are older, its cars tend to be spurned by young buyers. An attempt to attract youngsters in Japan with a funky range called WiLL met indifference.
The group has had more success in the US recently with its Scion brand, also aimed at younger buyers. Toyota faces a similar problem in Europe, but there are no plans to introduce Scion here. The posh Lexus marque is a big hit with US buyers, but is a failure in Europe, selling 22,000, half of which are bought by Britons.
Toyota's deft business planning has made it into the world's the most powerful vehicle maker, with estimated cash reserves of £17bn. Its return on sales is more than 8 per cent; most American and European companies would be happy with half that. Toyota's market capitalisation is greater than that of GM, Ford and DaimlerChrysler combined. So Toyota can do what it wants when it wants because it has all the technology, talent and cash it needs. You have been warned.Reuse content