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Last Updated: Wednesday, 26 October 2005, 07:33 GMT 08:33 UK
Toyota 'could outstrip GM output'
Cars in a New York parking lot
US carmakers are finding times tough
Japan's Toyota is set to supplant US giant General Motors as the world's most prolific carmaker in 2006, a Japanese newspaper says.

According to the Nihon Keizai Shimbun, Toyota is planning to increase output by 11% next year to more than 9.2 million vehicles.

With GM unlikely to top its 2005 forecast of 9.12 million, Toyota would be in pole position, the paper said.

GM still leads in the US, but is losing ground rapidly to Japanese rivals.

The US giant is struggling to cope with legacy costs, although it hopes that a recent deal struck with unions to cut healthcare bills could keep it out of bankruptcy.

Production is being cut back at factories in the US.

Neither GM nor Toyota have released detailed output estimates for 2006, although Toyota has said it expects to sell 8.5 million vehicles during the year.

The Japanese firm already dwarfs its US rival in market value - worth $163bn to GM's $16.6bn.

Trouble at home

In the US domestic market, US carmakers are seeing sales slide - a trend put down partly to soaring petrol costs and the falling-off of the effect of deep discounts.

But even within a generally weak car market, the Japanese firms - led by Toyota, Nissan and Honda - as well as some other Asian marques are eating into market share.

Total vehicle sales at Ford were down almost 20% in September, while at GM they dipped by 24% overall.

With fuel at a premium, the US firms' emphasis on large sports utility vehicles (SUVs) could be hitting their performance.

Ford said sales of its Explorer, the best-selling SUV in the US, dropped by almost two-thirds in September.

In contrast, total sales at Toyota rose 10% in September - with car sales rising 22% to offset a fall in truck sales of 4%.

Nissan said total sales were up 16.4% in September, while Honda's sales increased by 12%.

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