Toyota Motor Corp's global sales in the month of August fell once again after a momentary recovery and its worldwide sales also took a tumble. The Japanese auto giant is the world's largest-seller of automobiles but recent times have been challenging in its home base of Japan, key market of China as well as other international regions.

Toyota Motor Corp announced that its total production - including that of subsidiaries Daihatsu Motor Co. and Hino Motors Ltd. - fell by 12.6 per cent to 808,023 units in August when compared to the same month in 2023. Global sales also declined by a very noticeable 3.7 per cent after a very marginal improvement of 0.7 per cent in July.

While hybrid models are powering Toyota in several key markets across the world, the headwinds are coming in primarily from lacklustre demand for its electric vehicles (EVs) as well as an overall slump in demand for new vehicles across the globe. But domestic scandals in Japan and recalls in many markets overseas has not helped Toyota in particular.

Toyota wades through troubled waters in Japan

Toyota has been in the eye of a storm ever since its headquarters in Tokyo was raided in June over charges that the company had falsified safety test data when applying for certification. The company issued an apology even as other rivals of note - Honda, Mazda, Suzuki, Yamaha - also admitted to submitting incorrect data and came under the glare of Japan's Transport Ministry, as per BBC.

The main allegation made is that Toyota used modified vehicles in safety collision tests, prompting Toyota chairman Akio Toyoda to apologise. “We neglected the certification process and mass produced our cars without first taking the proper precautionary steps," he said.

Recalls rupture Toyota's global moves

At home, Toyota stopped shipment and sales of models like Corolla Fielder, Corolla Axio and Yaris Cross. But the pause was not just limited to its home base. Toyota has had to issue recall orders for around 45,000 units of its large SUVs in North America over suspected issue with tow-hitch cover. In May, the company recalled as many as one lakh units of Toyota and Lexus vehicles in the United States to check a potential engine failure issue.

All of this could not have come at a worse time because of the general lacklustre car-buying sentiments in some of the biggest markets in the world. In Japan in August, Toyota sales tumbled by nine per cent. More shockingly, the company sold just 119 of its overall 12,682 EVs sales in Japan in the month. In China too, the company is facing mammoth competition from a long list of local players who have upped their game.

In India, Toyota has a joint venture with Kirloskar Group and operates as Toyota Kirloskar Motor. While India is the world's third-largest car market in the world, the company is not among the top players even though models like Innova Hycross and Fortuner are hot favourites. The company did report a sales jump of 35 per cent in India last month, compared to August of 2023, selling 30,879 units.

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