General Motors will be overtaken by Volkswagen AG this year and fall to the world's third-largest automaker by production volume, market research company R.L. Polk Germany said today.

Global production of passenger cars and light commercial vehicles is forecast to fall 19 percent, or two million units, to 52.8 million vehicles this year -- the lowest output since 1998, Polk said.

GM, surviving with the aid of U.S. loans, will suffer a 31 percent drop in production this year, Polk said. VW will likely only see a slide of some 15 percent, thanks in part to its low exposure to the U.S. auto market, where sales have dropped 38.4 percent through March.

"Volkswagen will therefore overtake ... GM and advance to become the new No. 2 after Toyota," Polk said in a statement.

Polk expects global car output to increase in 2010 again, with strong growth rates in the next two years that allow the market to achieve a record production level of more than 70 million vehicles in 2012.