General Motors has already been taken over by Toyota as the world's biggest automaker, but the latest reports are predicting that the struggling Detroit giant is set to fall further down the list. In its place will emerge rival European automaker Volkswagen AG, which is expected to become the second biggest by the end of the year.
The predictions come from market research company R.L. Polk, which also claims that GM will be dropping its production numbers by over 30% this year. Comparatively, VW will only be dropping 15% of its production numbers, largely because of its more global operations and a lesser focus on the troubled U.S. market, according to Automotive News.
Overall, global production is set to hit the lowest levels in more than a decade, with Polk predicting that global production will amount to around 52.8 million units this year, a drop of almost 20% compared to last year. However, it’s not all doom and gloom for the automotive industry, with analysts predicting that vehicle production worldwide should be on the rise as early as next year, and sales should be increasing within the next two years.
The quick decline of GM through the financial crisis has been largely due to its inherent focus on the U.S. market, while many international competitors feature more globalized sales. Because of this, GM was one of the hardest hit by the compounding forces of the credit crunch, the burst of the housing bubble and the general global economic downturn.
Source: Automotive News.