Toyota Threatens GM’s Sales Crown as US Hybrid Demand Surges

The 2026 Toyota RAV4 Plug-in Hybrid GR Sport at the Vancouver Auto Show in Vancouver, British Columbia, Canada, on Wednesday, March 25, 2026. The Vancouver International Auto Show (VIAS) is British Columbia's largest-attended consumer event with 138,773 attendees over the 5-day event in 2025. Photo by James MacDonald /Bloomberg

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(Bloomberg) — General Motors Co. is facing an uncomfortable reality: Toyota Motor Corp. has a shot at taking the US sales crown once again thanks to growing demand for its gasoline-electric hybrids.

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The Japanese automaker is expected to grow its market share to 15.8% in the first half of this year, while GM’s share is expected to tumble by almost 1 percentage point to 16.8%, according to a forecast from researcher Cox Automotive. If consumers continue to flock toward fuel sippers, Toyota has a shot becoming the No. 1 auto seller in the US this year.

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“Toyota has a chance,” said Charlie Chesbrough, senior economist for Cox. “We’re not predicting it yet, but it’s possible. Consumers are interested in hybrids and GM can’t compete.”

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Still, Chesbrough expects GM to put up a fight. “They would use incentives to try to keep it.”

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Toyota overtaking GM in the Detroit automaker’s home market would mark a historic shift. GM has held the top spot since passing Ford Motor Co. in 1931, losing to Toyota once in 2021 due to the semiconductor shortage. It would also underscore that GM Chief Executive Officer Mary Barra’s big and risky bet on EVs over hybrids was a mistake, as American buyers aren’t ready to go all electric.

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GM spokesman Jim Cain disputed that the automaker would increase incentives to maintain its sales lead over Toyota. The company has worked to avoid rebates as part of a push to maximize profit and cash flow, holding incentives below the industry average for the last three years.

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“Our track record speaks for itself about discipline on production, pricing and incentives,” Cain said.

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A spokesman for Toyota had no immediate comment on whether the carmaker is on track to take the top sales spot in the U.S.

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Hybrid Momentum

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Through May, Toyota’s sales of electrified vehicles, which include battery-powered cars but are predominantly hybrids, rose 5.6% in a market that is expected to fall this year.

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By contrast, industrywide sales of full-size truck and SUVs, where GM and Ford are strongest, are both down as the war with Iran has pushed the average price of gasoline to almost $4 a gallon.

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Toyota earlier this week began producing the latest version of its best-selling RAV4, which is now only sold as a hybrid, at its plant near Lexington, Kentucky.

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To alleviate shortages of the popular compact SUV, the Japanese carmaker aims to boost US output to 100,000 vehicles at the plant this year, supplementing imports from Canada and Japan, said Kerry Creech, president of Toyota Motor Manufacturing Kentucky.

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“Our ramp up will be pretty fast,” Creech said in an interview. “We’ll be fully ramped up in 30 days” after implementing lessons learned from the earlier RAV4 production start at Toyota’s Canadian operations.

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Toyota offers hybrids on more than 20 models in its US lineup. GM has only the electrified Corvette and Ford offers a hybrid on only the Maverick small pickup, F-150 and Lincoln Nautilus SUV.