VW surpasses Toyota as world's largest automaker in first half of 2015

Volkswagen surpassed Toyota as the world's largest automaker in the first half of 2015, fulfilling a long-held goal, despite a sales slump in the U.S.

Volkswagen sold 5.04 million vehicles in the first six months of the year, edging Toyota's 5.02 million. General Motors, once the world's biggest automaker by a long shot, is now firmly entrenched in the No. 3 slot. It has not yet released its official first-half stats.

The title of world's largest automaker is largely a symbolic victory. But it does serve as an effective gauge of how global strategies are unfolding.

"It’s certainly bragging rights, and being able to communicate that they’re the largest automaker in the world is a powerful statement," said Tom Libby, an IHS Automotive analyst. "It’s certainly something they’re going to promote."

Volkswagen CEO Martin Winterkorn has long wanted the company to seize the No. 1 spot by 2018, but a spokeswoman declined to plant a triumphant flag on the news.

"We do not comment on the figures of other automakers," Volkswagen spokeswoman Jeannine Ginivan said in an email. "The goal of the Volkswagen Group is to focus on qualitative growth and not being No. 1 in sales."

Whether the German automaker can retain the No. 1 title for the full year is its next hurdle.

"They’ve been very aggressive and open about their desire to be No. 1, so it speaks to them executing their plan," Libby said.

Boosting volume has its benefits. It brings greater manufacturing scale, allowing the company to spread costs over a wider production footprint and thus bolster profits. But it can also take a toll on quality and profit margins, particularly if automakers raise incentives to give dealers a jolt.

"I think the race for volume is the wrong race. I think the race for profitability is the right race," AutoTrader.com analyst Michelle Krebs said. "So if I were running an automaker that’s the number I would be looking at. Because sales volume you can buy."

Volkswagen's ascension to the top spot is not a particularly devastating blow to Toyota, which remains immensely profitable and retains strong global market share.

Toyota's operating profit margin for its 2015 fiscal year, which ended March 31, was 10.1%, making the Japanese automaker the envy of the industry. Volkswagen's global operating profit margin was 6.3%.

"Sales volumes or being the largest global automaker has never been a goal for Toyota," Toyota spokesman Scott Vazin said in an email. "Our focus is on getting our products and services right for our customers and ensuring we are exceeding their needs and expectations. We congratulate VW on achieving its stated goal."

Despite Volkswagen’s global sales gains, it has struggled in the U.S. Industry experts say the namesake Volkswagen brand lacks enough selection and has lagged on quality in the world’s most lucrative car market.

U.S. sales of the Volkswagen brand fell 10% in 2014, despite a 5.9% gain in overall industry sales. For the first six months of 2015, Volkswagen brand sales fell 2.6%, compared to a 4.4% increase for the overall industry.

By contrast, U.S. sales for the Toyota brand rose 5.8% in 2014 and 5.2% for the first half of 2015.

In the 2015 J.D. Power and Associates Initial Quality Study, which examines new vehicles, Volkswagen's namesake brand ranked 24th out of 33 brands sold in the U.S.. The Toyota brand was 10th.

To be sure, though, the U.S. market has reflected one of Volkswagen's only significant slip-ups. The company has claimed the top spot in China, the world's largest vehicle market, and remains dominant in Europe.

AutoTrader.com's Krebs joked that the U.S. is like "an emerging market" to Volkswagen. which hasn't introduced new vehicles quickly enough in the U.S. and has failed to capitalize on the crossover movement.

"Volkswagen’s story in the U.S. is so different than their story globally," she said.

Still, the German automaker's global sales for the first half of 2015 fell 0.5% compared to the previous year, as tough economic conditions took a toll in foreign markets such as South America and Russia. The company's China sales fell 3.9% through June.

Toyota’s global sales fell 1.5% for the same period.

Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.