US & World

DETROIT (AP) ― Toyota Motor Corp. overtook Ford Motor Co. to become the No. 2 automaker by U.S. sales in 2007, using new products and relentless strategy to break Ford's 75-year lock on the position.

Toyota sold 2.62 million cars and trucks in 2007, which amounted to 48,226 more than Ford, according to sales figures released Thursday. Toyota's sales were up 3 percent for the year, buoyed by new products like the Toyota Tundra pickup, which saw sales jump 57 percent. Ford's sales fell 12 percent to 2.572 million vehicles.

General Motors Corp. remained the U.S. sales leader, selling 3.82 million vehicles in 2007. But that was down 6 percent from the previous year as customers turned away from some large sedans and sport utility vehicles and GM cut low-profit sales to employees and rental car agencies. GM's car sales fell 8 percent for the year while truck sales were down 4 percent.

Overall, the year was expected to be the worst for the auto industry since 1998 as consumers fretted over high gas prices, falling home prices and the economy.

December also was a tough month for automakers despite a slew of holiday discounts. Toyota's sales slipped 2 percent for the month, while GM's sales were down 4 percent and Ford's fell 9 percent.

Nissan Motor Co.'s December sales were down 2.4 percent, while Honda Motor Co.'s December sales were flat, with a 10 percent increase in car sales canceled out by a 10 percent decline in truck sales.

"This was definitely a challenging year to be in the car business, and 2008 isn't likely to be a piece of cake," Dick Colliver, executive vice president of American Honda, said in a statement.

Colliver said automakers with more fuel-efficient offerings fared better as gas prices took their toll. Honda's full-year sales were up 2.5 percent, thanks in part to booming sales of the Fit subcompact, while Nissan's shot up 5 percent thanks to strong sales of the Versa subcompact.

Chrysler LLC also had a solid December, with sales up 1 percent for the month thanks to brisk sales of the new Dodge Caravan minivan, which saw a 51 percent jump. Chrysler sales were down 3 percent for the year as falling truck and SUV sales erased gains on the car side.

Ford's car sales plummeted 24 percent for all of 2007 as some models like the Ford Mustang aged and a new Ford Taurus sedan was unable to match the volumes of the older version. Ford also cut rental-car sales by 32 percent over the year. Truck sales were down 5 percent.

Ford corporate historian Bob Kreipke said it was the first time since 1931 that Ford wasn't second behind GM in U.S. sales.

Toyota spokesman Irv Miller said the distinction wasn't important to Toyota.

"We don't pay a lot of attention to rankings such as that," he said. "It's always nice to see the product is recognized and accepted by the consumer. The consumer's going to be the ultimate determining factor in who the winner is."

Toyota got a boost partly from heavier than usual incentive spending as its Toyota Tundra joined the fiercely competitive full-size truck segment. Auto research site Edmunds.com estimated Toyota's incentives jumped from $822 to $1,063 per vehicle between November and December. But Toyota's general manager for U.S. sales, Bob Carter, said Toyota's incentives remain some of the lowest in the industry.

Jim Farley, who recently became Ford's global marketing chief after a career at Toyota, said the new numbers won't change Ford's recovery plan, which includes carefully targeted use of incentives.

"In fact, it actually accelerates the way we're running the business," Farley told The Associated Press in an interview Thursday morning. "It accentuates the difference between how we're running the business and how our competitors are running the business. It requires us to stick to the plan, no doubt, but it also requires us to really accelerate the development of new products."

Farley pointed out that Ford had some hits in 2007, particularly its Ford Edge and Lincoln MKX crossover vehicles. Ford crossovers grew 62 percent over the year, far outpacing the industrywide average of 17 percent, the company said.

Ford shares fell 15 cents to $6.45 after sinking to a 52-week low of $6.41 earlier in the session. GM shares lost 49 cents to $23.92 after dropping to a 52-week low of $23.34 earlier in the day. Toyota's U.S. shares rose 44 cents to $106.90 in trading in New York.

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