Toyota Motor Corp., replenishing auto inventory thinned by Japan’s earthquake in March, said it’s not likely to begin posting U.S. sales gains again for at least two more months.

Sales for Toyota, Asia’s largest automaker, will fall again in July after dropping 33 percent in May and 21 percent in June, Bob Carter, Toyota’s group vice president for U.S. sales, said yesterday. Supplies of cars and light trucks are still below average, and it will be weeks before dealers are fully restocked, he said.

“Our market share will begin recovering this month, but it will be September or maybe October before we’re really growing again,” Carter said in an interview in Cle Elum, Washington. “We were in too deep a hole, and we’re still digging out.”

Japan’s magnitude-9.0 earthquake and tsunami disrupted assembly operations for Toyota and Honda Motor Co. as a result of shortages of parts and electricity. Toyota’s U.S. sales slid 4 percent in the year’s first half, while the total market gained 13 percent, according to Autodata Corp., a Woodcliff Lake, New Jersey-based research company.

Edmunds.com, an automotive pricing and data company in Santa Monica, California, said today Toyota’s sales will likely fall 21 percent in July from a year ago, while TrueCar.com, also based in Santa Monica, estimated the Toyota City, Japan-based company’s sales will drop 33 percent. Both released their estimates in e-mailed statements.

Automakers are scheduled to report U.S. sales for July on Aug. 2. Toyota has said most of its production in Japan and North America will recover by September, reported Bloomberg.

The company’s first-half market share was 12.8 percent, down from 15.1 percent a earlier, according to Autodata.

“Inventory issues are not seriously holding back Toyota anymore, and a 25 percent month-over-month boost in incentives are helping the company finally pick up the sales momentum that it needed,” Jessica Caldwell, senior analyst at Edmunds.com, said in an e-mailed statement today.

“But with sales expected to be off more than 20 percent compared to July 2010, Toyota still has a long way to go,” she said.

While U.S. auto demand should continue to recover this year, sales aren’t growing as fast as Toyota expected because of weak consumer confidence, Carter said.

“That’s the most important thing for us, and right now the consumer doesn’t seem to be that confident about jobs and the overall economy,” he said.

Toyota’s American depositary receipts, each representing two ordinary shares, fell 74 cents to $81.43 at 4:15 p.m. in New York Stock Exchange composite trading. The company’s U.S. sales unit is based in Torrance, California.

Toyota Motor Corp., to make its earnings target this year, needs the new Camry to wrest back market share from Hyundai Motor Co.’s Sonata sedan.

The Camry, the best-selling car in the U.S., has lost ground to the Sonata, with Seoul-based Hyundai raising its U.S. output and surpassing the Camry in May for the first time.

“Sonata became a very honorable contender in the market,” said Yoshimi Inaba, Toyota’s North American chairman, in a July 12 interview. “We do have good respect for the model, and the sales figures show it’s increasing quite a bit.”

U.S. sales of Camry last year dropped 31 percent to 327,804 compared with deliveries in 2007, Toyota’s best-ever year, while Honda Motor Corp.’s Accord sales also dropped 28 percent to 282,530 in the period, as both models approached the end of their product cycles. Sales of the Sonata, revamped in January 2010, surged 35 percent to 196,623, reported Bloomberg.

The 2011 Sonata’s overall design quality is rated “among the best” by J.D. Power & Associates and earned a “Top Safety Pick” award from the Insurance Institute for Highway Safety.

Until a few years ago, Toyota’s Camry and Honda’s Accord “defined” the midsize segment in the U.S. for at least a decade, said Jeremy Anwyl, chief executive officer of auto researcher Edmunds.com in Santa Monica, California. “But Hyundai has really stepped up their game, and Toyota’s been paying attention.”

The next version of the Camry will have a more contemporary design and improved performance and handling, President Akio Toyoda told U.S. dealers on June 29 in Las Vegas. The new model will go on sale in the latter part of the year.

Toyota’s current Camry, last refreshed in March 2006, gets up to 32 miles per gallon in highway driving in the U.S., compared with the Sonata’s 35 mpg and Honda’s 34 mpg. With Hyundai’s improvements in design and fuel efficiency, sales of the Sonata have jumped 29 percent to 115,014 units this year through June, while the Camry has dropped 4.4 percent to 147,469 in the U.S. Restricted production after the March 11 earthquake in Japan has also contributed to the decline.

Hyundai didn’t have to slow production after the quake as its Japan-based suppliers’ plants aren’t located in the affected areas, according to the company. As a result, Sonata outsold Camry in May for the first time, according to Edmunds.com.

While both the Sonata and Camry sold in the U.S. are built locally, the weak Korean currency relative to the dollar benefits Hyundai when it repatriates profit. The yen, on the other hand, has hurt Toyota by gaining about 10 percent over the past year. The Japanese currency on July 13 climbed to as high as 78.50 yen per dollar, the strongest since March 17.

The 2011 Camry is currently priced from $20,195, compared with the Sonata’s $19,395 starting price tag.

Camry – which is the Anglicized spelling of “kanmuri,” meaning “crown” in Japanese – accounted for about a fifth of U.S. sales at Toyota last year.

Defending its lead will be more difficult given stiffer competition from Hyundai, Ford Motor Co., and an “ambitious” Volkswagen AG, said Tadashi Usui, an analyst at Moody’s K.K. in Tokyo.

Sales of Ford’s Fusion sedan have jumped 18 percent this year through June, outselling the Accord. Volkswagen, aiming to topple Toyota as the world’s biggest carmaker by 2018, will start selling a Tennessee-built Passat sedan as early as September.

“I’m not necessarily optimistic that the new Camry will help Toyota regain market share,” Usui said.

With a drop in demand for pick-up trucks, Toyota is more dependent now on its best-selling Camry, along with Lexus luxury models to boost earnings, he said.

Moody’s Investors Service lowered its debt rating on Toyota on June 28, taking it below Japan’s sovereign grade for the first time, citing weaker ability to recover previous levels of profitability. Toyota expects to earn 280 billion yen ($3.52 billion) in net income this fiscal year, compared with 1.7 trillion yen in the year ended March 2008.

Helped by the new Camry, Toyota’s market share will rise to 15 percent in the six months ending in December, from 12.8 percent in the first half of the year, according to consulting company IHS Automotive, based in Englewood, Colorado. Still, Toyota’s share will stagnate at that level over the next three years because of strong competition, said IHS analyst Masatoshi Nishimoto in Tokyo.

“Toyota will not recover its 16-17 percent market share from before the financial crisis,” he said.

Honda, which will likely introduce its updated Accord sedan next year, will also remain at about 11 percent market share through 2014, slightly up from 10.6 percent last year, according to IHS. Hyundai, including affiliate Kia Motors Corp., will rise to at least 8.5 percent in the period, from 7.7 percent in 2010.

“We recognize that the Korean models are very competitive because of their good quality and affordable price,” said Keitaro Yamamoto, a spokesman for Honda in Tokyo. “Before, it was Accord versus Camry, but it’s definitely becoming Accord versus Camry versus Sonata.”

While analysts cite Hyundai’s improvements in styling as a factor for its growth, design may not be as important as performance. “People buying a Camry aren’t looking to make a statement,” Anwyl said. “They’re looking for dependability.”

The new Camry is Toyota’s first major full-model change since last year’s recalls of more than 10 million vehicles for flaws linked to unintended acceleration.

Following the recalls, Toyoda formed a global quality committee to tackle defects. In the U.S., the carmaker hired additional engineers at its technical center in Ann Arbor, Michigan, as the facility plays a bigger role in developing models for the American market.

“If there are any lingering concerns on Toyota’s vehicle safety, this is a good opportunity to close that chapter,” Anwyl said.

CHICAGO- Toyota Motor Corp’s brand Lexus will end its streak of 11 years as the top luxury brand in the U.S. market due to lost sales in the aftermath of the Japan earthquake and tsunami, said Mark Templin, Lexus Division general manager.

Templin said Lexus U.S. sales will fall about 17 percent to around 190,000 vehicles in 2011, reported Reuters.

The United States is the biggest market for Lexus.

All Lexus models, except the RX 350 crossover sport utility vehicle, are made in Japan.

Templin said the Cambridge, Ontario plant that makes the RX 350 will be back at full capacity in September.

Most Japanese plants assembling Lexus models have already returned to full strength.

However, the RX 450h hybrid SUV will not be at full production until October. The hybrid is typically 15 percent to 20 percent of RX sales in the U.S. market.

Lexus U.S. sales fell 38 percent in June as dealers ran out of key products. At the end of the month, dealers had about half their normal stock.

“June was the bottom of the trough, and we’ve turned the corner. We see the rest of the year being much better for us,” Templin said, speaking to reporters at a Lexus media event in Chicago.

Lexus sales tumbled 18 percent in the first half of 2011 to 88,010, and German rivals BMW and Daimler AG’s Mercedes-Benz sprinted by.

BMW’s sales rose 13 percent to 113,705, and Mercedes-Benz climbed 7 percent to 110,926. If 2011 full year results end as expected, it would be the first time that BMW has outsold Lexus in the U.S. since 1997.

Templin shrugged off the significance of losing the luxury sales crown, and when asked if Lexus could reclaim the top spot in 2012, he said.

“Whether we’re No. 1 or not, I don’t care. We’ve never focused on that. We won’t change our plan midyear because someone else is selling more cars than us.”

Industry analyst Aaron Bragman of IHS Automotive Insight said on Friday the slump at Lexus goes deeper than a shortage of vehicles. He suggested that Lexus could suffer from the same stigma as did General Motors Co’s Buick brand for the past several decades: old people’s car.

Bragman said it would be “quite a challenge” for Lexus to reclaim No. 1 in luxury sales in 2012 even with full production because its lineup is not as alluring as it once was and it relies heavily on two models, the RX 350 and ES 350 sedan, a spinoff of the Toyota Camry.

The RX so far this year accounts for 45 percent of Lexus U.S. sales and the ES sedan 19 percent.

“Like Toyota, they’ve lost their momentum. They have an aging buyer base, and a lot of their dealers are afraid they will become the next Buick. Their new products haven’t resonated with younger buyers.”

The median buyer age for Lexus is in the mid-50s, and Templin said he is comfortable with that because it is a result of high loyalty.

Sportier models such as the IS sedan and CT hybrid sedan are attracting younger owners, said Templin.

Toyota Motor Corp., with as little as one day’s worth of Prius cars on dealers’ lots after the March earthquake, says sales of the hybrid will still beat 2010.

Asia’s largest automaker is racing to replenish supply after the lack of inventory led to a 61 percent drop in Prius deliveries in the U.S. in June, to the lowest level since September 2004. Almost half of Prius models are sold in the U.S., where the car accounts for more than 60 percent of hybrids sold since 1999, according to data supplied by automakers, reported Bloomberg.

Prius, the company’s No. 3 selling car after the Corolla and Camry, is the fastest-growing Toyota car this year, even with the quake-depleted inventories. Demand for efficient autos has increased this year with higher fuel prices. General Motors Co.’s Chevrolet Cruze was June’s top-selling car in the U.S., while deliveries of Ford Motor Co.’s Focus rose 41 percent.

“Dealers simply cannot get their hands on them quick enough,” said Ivan Drury, an analyst for Santa Monica, California-based Edmunds.com, an industry pricing and data website. The model “is easily the poster child for inventory issues.”

Toyota’s American depositary receipts, each representing two ordinary shares, fell 24 cents to $84.40 at 4:03 p.m. in New York Stock Exchange composite trading. The ADRs have risen 7.3 percent this year.

Prior to the Japan quake, Toyota targeted Prius sales in 2011 that would top the car’s 2007 peak of 181,221. While that level may be out of reach for now, Toyota can still exceed 2010’s deliveries of 140,928, said Donald Esmond, Toyota’s senior vice president for U.S. sales.

Production of Prius and two Lexus hybrids is rebounding faster than Toyota first estimated after the 9-magnitude quake in March. The company expects to be back at full output by September, rather than its earlier target of late 2011. The lack of available hybrids from Toyota has held the segment to 2.1 percent of industrywide U.S. sales so far this year.

Even though Prius isn’t among the automaker’s most profitable lines, Toyota sees it as the best opportunity to win new customers in the next few years, said Jim Lentz, president of Toyota’s U.S. sales unit. The nameplate will be expanded to include the Prius v wagon, Prius c subcompact and plug-in Prius.

“By the end of this decade, the Prius nameplate will be the number one passenger car nameplate in the industry,” Lentz said in a July 6 phone interview.

Boosting Prius supply, along with the introduction of the wagon version and a revamped Camry sedan later this year, gives the Toyota City, Japan-based automaker a shot at making up for some sales lost in May and June.

Toyota also wants to ease a backlog for Prius that’s pushed the wait time for consumers to as long as three months in some parts of the U.S. from none at the start of the year, said Jesse Toprak, an industry analyst.

“At the moment, it’s the least available of any mass- produced vehicle,” said Toprak, with Truecar.com, an industry pricing and data company in Santa Monica.

U.S. demand for fuel economy is up this year as gasoline prices approach 2008’s record of $4.114 a gallon. While the fuel cost an average of $3.569 per gallon on July 5, down from $3.985 on May 4, the price is up 30 percent from a year ago, according to AAA’s Daily Fuel Gauge website.

Higher prices at the pump buoyed sales of subcompacts and small cars, with such vehicles rising 21 percent this year through June, according to Woodcliff Lake, New Jersey-based Autodata Corp. That compares with an 11 percent gain for midsize cars and a 4.7 percent drop for the large sedans, Autodata said.

Prius’ fuel-economy appeal has never been higher, said Bob Carter, Toyota’s group vice president for U.S. sales.

Interest in the car was up 36 percent in June from a year ago, based on consumer visits to Toyota’s Prius website, according to Edmunds.com, an industry pricing and data website.

“I have extremely high demand, and the outlook is continuing to improve,” Carter said in a June 22 interview.

Failure to ramp up supply quick enough may blunt Toyota’s goal to notch its first U.S. annual sales gain since 2007. It also risks driving some buyers to models such as Ford’s hybrid Fusion sedan and Hyundai Motor Co.’s new Sonata Hybrid, said Toprak.

The growing selection of highly fuel-efficient, gasoline- engine small cars also threatens to lure away potential Prius buyers, said Edmunds.com’s Drury.

“Some consumers might be willing to wait, but as time goes on and awareness of the many redesigned compact cars becomes higher, Toyota could suffer,” Drury said.

Sales of the Prius in the first half were 66,520, little changed from 66,039 a year ago, when recalls of Toyota and Lexus models temporarily damped demand. Prius accounted for 8.2 percent of the company’s U.S. sales during the period, while Camry deliveries were 18 percent and Corolla sales were 16.8 percent.

Toyota’s U.S. sales in the second quarter “slowed as inventories dropped and as a result, we find ourselves at virtually the same position we were a year ago on July 1,” Esmond said on July 1 conference call. “We won’t finish the year that way.”

While Toyota’s Tsutsumi, Japan, plant that makes Prius and its Kyushu factory that builds hybrid Lexus CT200 hatchbacks and HS250 sedans weren’t damaged by the March 11 disaster, parts needed for the cars grew scarce because of damages to suppliers’ operation.

The automaker prioritized production of the three gasoline- electric cars after determining they were in the highest demand, said Shiori Hashimoto, a spokeswoman for the Toyota City, Japan- based company.

“We worked hard to find out which components were critical, conditions of the supply chain, and how the limited car parts should be delivered to which assembly lines,” said Hashimoto, who is based in Tokyo.

To restore Prius production as fast as possible after the quake, Toyota began sending about 150 workers from other factories in Japan to the Tsutsumi plant in late March, said Tomotaka Yagai, a spokesman at Toyota Motor Workers’ Union in Toyota City. Hashimoto declined to confirm the figure.

So far, Toyota has only confirmed the U.S. will get a shipment of 36,000 Priuses that will arrive from this month, with more on the way, Carter said.

“I can’t give you a specific number, but it will improve significantly,” he said, without elaborating.

Billy Rinker, general sales manager at Toyota Santa Monica, said a fresh supply of the cars has been arriving since late June. The Los Angeles-area dealership claims to be the largest seller of Prius in the U.S., with average monthly sales of 100 to 150 of the hybrids, he said.

“We only had 30 to sell last month, but July looks like we’ll be back to about 80 percent of normal,” Rinker said. He estimates the dealership will sell about 100 this month.

That won’t eliminate the dealership’s backlog. “We’re still keeping a list and taking deposits for the car,” Rinker said.

With the Prius v wagon, followed in 2012 by the subcompact Prius c and plug-in Prius, Toyota expects its “Prius family” to become its top-selling line within the decade, Carter said.

“A lot of our future plans are centered around the Prius and that goes into vehicle launches next fall,” he said.

Toyota said July 1 a new Camry and Camry Hybrid, Scion iQ minicar and revamped Yaris subcompact will arrive this year along with the v wagon.

The company is counting on those models, together with the jump in Prius supply and rebounding inventory of all its Toyota, Lexus and Scion products, to reverse a 4 percent slide in U.S. sales through June.

“It’s coming back quicker than any of us expected,” said Paul Atkinson, whose dealership in Bryan, northwest of Houston, ran out of Prius cars last month. “Now it’s time to go out and sell like hell.”

Toyota Motor Corp. plans to restore Lexus RX production in Canada to full speed in September and have dealers stocked with RX sport-utility vehicles by December, said Mark Templin, the U.S. chief of Lexus.

Sales of Lexus vehicles fell this year as the tsunami in Japan disrupted suppliers and reduced manufacturing. Lexus sales in June in the U.S. fell 38 percent to 10,773 from 17,332 a year earlier. For the first half, U.S. Lexus sales slid 18 percent to 88,010, reported Bloomberg.

“June was the bottom of the trough,” Templin said today at a media luncheon in Chicago. “We see a bright future.”

The RX is the top-selling Lexus model. Through June, dealers sold 39,838 in the U.S., 9.1 percent fewer than in last year’s first half.

The brand’s buyers haven’t gone to other manufacturers because of the company’s troubles with production, Templin said.

“They’ll be there when we do have product,” he said.

Sales of Bayerische Motoren Werke AG’s BMW brand rose 13 percent in the first half, the same as the rest of the U.S. auto market. Daimler AG’s Mercedes-Benz gained 7 percent, according to research firm Autodata Corp. and company statements.

Japanese auto makers are getting their groove back as domestic sales rebounded in the month of June, a welcome harbinger that the post-March 11 slump may be nearing an end. But the leap was especially sweet for Toyota Motor Corp., as the Prius reclaimed the crown as the best-selling vehicle in Japan for the month of June.

Toyota sold 19,429 Prius vehicles in June, triple the figure it sold the previous month and enough to zip past Honda Motor Co.’s Fit in monthly sales for the first time in four months, according to the Japan Automobile Dealers Association on Wednesday. Honda sold 16,321 Fit compacts in June, reported The Wall Street Journal.

It was a marked improvement for both auto makers after sales took a nosedive following the March 11 natural disasters. Crucial parts became scarce when the earthquake-triggered tsunami slammed into key factories, disrupting the supply chain that significantly pared production output. A scant 4,876 Prius vehicles were sold in April, just a quarter of the number compared to the previous month. Sales of the Fit sank to about 8,500, or about 40 percent compared with March. But the two giants expect production to recover this summer.

The Prius and the Fit have been the top two selling vehicles in Japan since May of 2009 when the Prius debuted, except for last month when Toyota’s Vitz nudged the Prius down to No. 3.

With signs that business is returning to normal, the show must go on. The auto makers launched much-anticipated versions of their princely hybrids in recent months. In May, Japan got a Prius minivan in the Alpha and a month later Honda launched the Shuttle, the wagon version of the Fit. As the only two hybrid wagon type vehicles on the market, they are destined to be rivals. The Alpha and the Shuttle are slated to be launched globally later this year.

The orders poured in: Toyota received 52,000 for the Alpha in a month’s time and Honda’s Shuttle collected 12,000 in less than two weeks. But in terms of sales, Honda has been able to get more Fits off the lot. Honda sold 4,555 Shuttle wagons, comprising about 28 percent of number of Fits. Meanwhile, 2,929 Alphas left showrooms in Japan last month.