Volkswagen unseats Toyota as world's biggest automaker despite dieselgate

VW, which also makes the Audi and Porsche brands, saw a 3.8 percent increase in sales helped by demand in China.

Volkswagen has been steadily gaining market share on Toyota over the last 6 years becoming the third largest automaker in the world in 2008 and posting record sales of 6.29 million vehicles in 2010. Volkswagen recently agreed to pay over $20 billion in settlement and plead guilty to criminal charges in the United States over its admission that it manipulated its diesel cars with software to cheat emissions regulations.

This is the first time that Toyota has lost the crown since 2011, when the company was hit by supply chain disruptions caused by a massive quake that led to a tsunami in Japan's north-eastern region. According to the analyst, Volkswagen is poised to stay at the top for the next few years.

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Toyota also suffered in the key US market a year ago, with a 2% decline in sales, according to Autodata.

As part of a far-reaching overhaul under new division chief Herbert Diess, the VW brand has embarked on a restructuring push outside China and will boost its line-up of sport utility vehicles, the industry's fastest-growing segment, where it lags behind Toyota and General Motors.

On Monday Toyota said it sold 10.175 million vehicles worldwide previous year, a 0.2 percent increase. The last time General Motors was at the top was in 2011 after Toyota's productions took a severe beating following an natural disaster. Toyota was already singled out for a Twitter-scolding by president Trump earlier this month over its plans to build a new plant in Mexico.

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Volkswagen has overtaken Toyota Motor Corporation to become the world's best-selling automaker.

GM, which came in third for 2015, said it will announce its annual sales figures on February 7. Volkswagen's growth this year has been attributed to growing sales in China that have gone from about 60,000-80,000 units a year to over 1,00,000 units a year for 2016.

By another measure, though, Toyota remains ahead of VW, profit.

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