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The battle for top spot in the automotive industry is the focus of today’s show. Currently the title of No.1 automotive maker goes to Volkswagen; the German manufacturer. How did they get to the top? How long will they stay there? These questions and more in this episode of Down to Business English.
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Dez: This is Dez Morgan here reporting in from Abu Dhabi in the UAE.
Skip: And I am Skip Montreux coming to you from Tokyo, Japan.
Dez: And you’re listening to the latest episode of Down to Business English.
Skip: So Dez you are back in Abu Dhabi again after yet another of your holidays, so good of you to grace us with your company.
Dez: This was only a 4 day trip and I did it all for our listeners.
Skip: Oh sure you did, but anyway how was your trip to…Beirut, wasn’t it?
Dez: That’s right and it was great. Beirut is a beautiful city and interestingly is one of the few places around the world that is bucking the trend and remains in a solid growth pattern.
Skip: Countries around the world that are bucking the trend. That sounds like a story we should definitely do here on the show.
Dez: I imagine all of our listeners need a bit of cheering up so that will certainly be something we will discuss in the near future.
Skip: Returning to Beirut. Did it seem to be prospering?
Dez: It certainly did. The restaurants and bars were all doing a roaring trade, new cars everywhere and all of the top name boutiques seemingly doing great business.
Skip: New cars everywhere. Did you see many Volkswagens?
Dez: Strange that you would ask but no, mostly Mercedes and American cars.
Skip: That is surprising as VW has just overtaken Toyota in the top spot as the biggest car manufacturer in terms of units sold.
Dez: Really?
Skip: Yes indeed and that is our story for today so let’s do it, let’s get D2B with the auto industry; who is on top and why and how long can they expect to stay there?
Dez: So Skip you’ve already let the cat out of the bag and told us who is on top are you now going to tell us why?
Skip: I most certainly am. The main reason of course is that VW has been eating Toyota’s lunch for the past six months. Now remember, Toyota ended General Motors’ 77 year reign at the top way back in 2008 and had looked strong ever since. That was until Toyota was hit by the double whammy of the earthquake and tsunami in Japan and now the flooding in Thailand.
Dez: Flooding in Thailand. What does that have to do with Toyota?
Skip: Well, you are forgetting how global the automakers are today. Toyota has factories in Japan, of course but also in the U.S., Thailand, Australia, India, Sri Lanka, Canada, Indonesia, Poland, South Africa….
Dez: I think we get the idea.
Skip: Turkey, Colombia, the United Kingdom, France, Brazil, Portugal, and more recently…
Dez: Now you are just being really annoying.
Skip: …no wait a minute, Argentina, Czech Republic, Mexico, Malaysia, Pakistan, Egypt, China, Vietnam, Venezuela, the Philippines, and Russia.
Dez: Finished?
Skip: Yes. I just wanted to show you just how global Toyota has become.
Dez: Yes, and you certainly managed that.
Skip: Anyway Toyota’s truck and diesel engine divisions are extensively based in Thailand so the flooding in that country has really hit Toyota’s overall production. The result being analysts expect VWs 2011 sales will climb by 13% and reach 8.1 million units, compared to an 8% increase for GM, at 7.55 million units and a 9% drop for Toyota into 3rd place with only 7.27 million units sold.
Dez: So that explains Toyota’s drop in sales but why has VW done so well?
Skip: Well VW is also a global manufacturer with facilities in ….
Dez: If you’re going to list them all I am leaving.
Skip: Okay sorry, but VW does indeed have factories in a lot of countries but the key markets for the German manufacturer in 2011 have been India and China.
Dez: That links in with my India Part 3 story on luxury goods sales in the Indian markets.
Skip: A good example of our interconnected world in action. Coming back to VW it is important to remember that Volkswagen also owns Bentley, Skoda, the Spanish car maker Seat and Audi. For the Indian market Volkswagen is marketing Skoda to the lower end, VW to the middle and Audi at the luxury end.
Dez: Yes it’s easy to forget that like GM, Volkswagen has a wide range of makers that satisfy different ends of the market.
Skip: With 2 factories in India sales are predicted to triple over the next 10 years. But India is small potatoes compared to the Chinese market.
Dez: Go on.
Skip: VW is the largest foreign car maker in China with overall sales growing 46% in 2010. That was led by a 64% growth in sales of the luxury Audi brand.
Dez: So as people move up the wealth scale in China there is always another VW product waiting for them all the way to the super luxury Bentley models.
Skip: It would seem so.
Dez: Okay, shall we get to our next question. How long can VW expect its reign at the top to last?
Skip: Not long I am afraid. Analysts believe that Toyota will be back at full production by the end of this year and will once again take the top spot.
Dez: So that is that then?
Skip: The long term fight might still be on. VW has invested a further 62.4 billion Euros in Chinese production so could once again overtake Toyota sometime in the future.
Dez: Time will tell I guess.
Skip: And now it’s time for us to get…D2V Down to Vocabulary.
Dez: This time out we’ve concentrated on expressions or multi-word verbs, so I’ll get things started with the expression to buck the trend which simply means to go against or be opposite to the general trend or movement. In the story I said that the economy in Beirut, Lebanon appeared to be growing when the trend around the world is generally negative.
Skip: A further example would be Ford bucking the trend to make smaller cars more affordable. Instead they are choosing to make them more fun to drive by including features such as the Ford sync system.
Dez: I own a Ford but haven’t got one of those. What is a sync system?
Skip: It is a system that allows you to sync your mobile devices to your car. Basically creating a completely voice activated driving experience with your music and other apps.
Dez: Sounds cool.
Skip: Next up I have the phrase to do a roaring trade which means when a company or shop is busy and selling a lot of products. In the story Dez said that the restaurants in Beirut were really busy, or doing a roaring trade.
Dez: I imagine that the Mac shop does a roaring trade when they introduce a new iPhone or iPad?
Skip: How would I know?
Dez: Skip.
Skip: All right yes they do, at least every time that I have been there they are.
Dez: Thought so. My next phrase is to let the cat out of the bag, which means to tell something that had previously been a secret or was unknown. In the story I accused Skip of telling you too soon that VW was the number one car maker. I said that he had let the cat out of the bag.
Skip: Another example would be the results of the Academy Awards for movies are very closely guarded so that no one accidentally lets the cat out of the bag.
Dez: It would spoil the anticipation.
Skip: It would. Next I have the expression to eat someone’s lunch which means to take over, or in this case to take market share from another company. In the story I said that VW has been eating Toyota’s lunch over the past 6 months or taking customers away from it as Toyota has been having a lot of problems.
Dez: Referring back to our October 28th story on Boeing’s Dreamliner I read that the Dubai based airline, Emirates just placed an order for 50 planes so maybe Boeing will be eating Airbus’ lunch for the next few years.
Skip: And a pretty rich lunch it is, no doubt.
Dez: Indeed. My next phrase is a double whammy, which means to be hit by two bad events at the same time or shortly after each other. In the story Skip said that Toyota had been hit by the double whammy of the tsunami in Japan and floods in Thailand.
Skip: I can tell you someone else who was hit by a double whammy.
Dez: Who would that be?
Skip: Me! I had to go to Nagoya as a teacher suddenly needed some time off and at the same time was preparing a big contract in the office at the same time. That was a week I hope never gets repeated.
Dez: My sympathies. But moving on to a somewhat casual phrase small potatoes. When something is described as small potatoes it means that it’s minor or insignificant. In the story Skip said that VW’s sales in India are small potatoes or somewhat insignificant compared to the size of the company sales in China.
Skip: Returning to another earlier story on RIM the maker of the Blackberry smart phone, Blackberry’s market share is small potatoes at 15% compared to Google’s Android and Apple’s iPhone.
Dez: How the mighty have fallen as we say.
Skip: Yes that is true. To close vocabulary today I have the expression to reign at the top which can be broken down into reign which means to be in a position of power and at the top meaning in the lead. In the story Dez asks how long will VW reign at the top as the world’s No 1 car maker.
Dez: Do you remember when Sony’s Walkman reigned at the top of personal music players?
Skip: I do but of course we now mostly use iPhones and iPods.
Dez: We do. And that about does it for vocabulary today.
Dez: Thanks Skip good chatting with you
Skip: You too Dez. Good to have you back from your travels.
Dez: Everyone, please go online at the downtobusinessenglish.com website and download the audio script for today’s show.
Skip: Great idea that’s downtobusinessenglish.com . One more time, that’s downtobusinessenglish.com . And while you are on the site be sure to check out the earlier shows mentioned today, if you haven’t listened to them yet. We also urge you to sign up for the Down to Business English Newsletter. Our next issue is coming out soon.
Dez: Thanks for listening and see you all again soon.
Skip: Yes thank you very much everyone. Bye for now.
Dez: Bye.
