Toyota Motor witnessed a 7% drop in global sales last month compared to the previous year. The decline was primarily fueled by significant decreases in China and Japan.

In China, the world’s largest auto market, sales nosedived by 36%. The timing of the Lunar New Year holiday in February, as opposed to January last year, contributed to this decline. The intense competition in China’s auto market exacerbated the situation, leading to a cut-throat price war.

Although China’s sales downturn for January and February combined was less severe at 0.7%, it still lagged behind the industry-wide increase in passenger vehicle sales, which saw a 6.4% rise.

Conversely, Toyota experienced a notable surge in US sales, up by 16%, and a 14% increase in Europe. However, the company faced a significant setback in its home country, Japan, where sales plummeted by a third. Production stoppages at Daihatsu, a subsidiary of Toyota implicated in a safety test scandal, contributed to the decline.

The scandal, which involved rigged collision safety tests, tarnished Toyota’s reputation in Japan, despite Daihatsu brand vehicles not being included in Toyota’s global sales count.

Toyota also saw double-digit declines in sales in Indonesia and Thailand. Hybrids constituted almost 40% of the vehicles sold by the automaker globally in February, indicating a continued interest in environmentally friendly vehicles.

Global sales figures encompass both Toyota and Lexus brand cars. Notably, Daihatsu’s sales plummeted by 66% in February, further impacting Toyota’s overall performance.

In terms of production, Toyota’s global output for February decreased by 2.6% to 737,178 vehicles. The challenges faced by Toyota in key markets underline the complex landscape of the global automotive industry.