Volkswagen snatches World’s Largest Automaker 2017 trophy. The true hero is the Alliance

Source: Company data

The final numbers (so far) are in for 2017, and in a dramatic photo finish, Volkswagen snatched the top spot in the race for World’s Largest Automaker 2017, scraping past the Renault-Nissan-Mitsubishi Alliance by just 1,441 units, or 0.01% more. Toyota took 3rd.

The Volkswagen number of 10.741 million has been public for nearly two weeks, and the urge to add a few cars must have been high. Congratulations for resisting temptation.

For most of the year, the Alliance was in the lead. Through November, it looked like Volkswagen would end the year with 10.5 million units, and the Alliance with 10.6 million.  Then in November, Volkswagen suddenly reported an 11% month-on-month increase, followed by an 8.5% month-on-month increase in December. This is more than double Volkswagen’s 2017 year-on-year increase.

In the past years, I have been told by multiple sources inside of Volkswagen that its numbers can be somewhat elastic.  Padded numbers go by acronyms like “UBAR,” or are internally called “ghost cars,”  I was told. Once in a while, the padding of numbers even becomes public. In France alone, 800,000 cars were reported as sold, “months, or sometimes years” before they found a new owner, internal auditors said. “Apparently, the objective was to make the year-end numbers look better,” wrote Der Spiegel.

The Alliance’s strong showing is even more impressive, considering that many people in the world (and some in the media) don’t even know that the Alliance exists.

By now, you may have heard from Reuters that “Renault-Nissan group pips VW to become top-selling carmaker in 2017.” True in the lawyerly sense (except for the ‘car’ part, as we shall see) but disingenuous. Reuters only counted “light vehicles,” but that’s not how it works. The global automaker umbrella group OICA, the record keeper and last word when it comes to global automaker rankings, counts as an automobile everything with four wheels or more that has a motor and does not run on rails. This includes the trucks and buses the Alliance does not make. Volkswagen Group has 183,000 trucks and buses made by MAN and Scania in its tally. Toyota Group’s Hino adds a similar number of trucks and buses. Given that, being behind by 1,441 is an honor that doesn’t need parsing.

Also, OICA ranks automakers by production, not by sales. One should try to stick as closely as possible to the official methodology, if only to avoid embarrassments like last year when, OICA crowned Toyota as world’s largest, after it was widely reported that Volkswagen had won. The OICA list is what finally goes into Wikipedia.

Due to the different methodologies of their measurement, “sales” numbers have proven to be unreliable, and prone to ‘sales reporting abuses,” as recent scandals in the U.S., along with rampant “self-registrations” in the EU have shown.

At the same time, data reported by automakers are becoming increasingly hard to compare.

Toyota reports production only. Volkswagen reports “deliveries” to wholesale – which is, at least for this exercise, close enough to production. The Alliance numbers are a blend of production data reported by Nissan and Mitsubishi, and deliveries reported by Renault.