Akio Toyoda reportedly will become Toyota's next president in June
01-23-09, 12:37 PM
#16
Is this good, bad or indifferent?:
Toyota to Replace Top Managers
By WardsAuto.com Staff From Wires
Toyota Motor Corp. reportedly will replace most of its top managers after Akio Toyoda takes over the role of president from Katsuaki Watanabe.
Toyoda, currently an executive vice president, will replace the other four executive vice presidents at TMC, as well as many of the auto maker’s senior managing directors, which currently number 19, Bloomberg says.
Toyoda, the grandson of TMC founder Kiichiro Toyoda, was named the auto maker’s new president earlier this week. He will assume the role, pending shareholder approval, in June.
Meanwhile, Toyota is said to be considering voluntary layoffs at its U.K. and North American operations, Reuters reports.
The cuts, which likely will be achieved through early-retirement offers, are to include 1,000 workers.
A Toyota North America spokesman is quoted as saying no involuntary layoffs are being considered by the auto maker at this time.
Toyota’s sales worldwide, including the U.S., its largest and most-profitable market, have been falling steadily as the auto maker, which just passed General Motors Corp. for the No.1 global sales title, succumbs to the ongoing economic slowdown.
Toyota repeatedly has adjusted vehicle output at its plants worldwide, as well as cut temporary workers at the manufacturing level and at its U.S. sales arm.
Toyota to Replace Top Managers
By WardsAuto.com Staff From Wires
Toyota Motor Corp. reportedly will replace most of its top managers after Akio Toyoda takes over the role of president from Katsuaki Watanabe.
Toyoda, currently an executive vice president, will replace the other four executive vice presidents at TMC, as well as many of the auto maker’s senior managing directors, which currently number 19, Bloomberg says.
Toyoda, the grandson of TMC founder Kiichiro Toyoda, was named the auto maker’s new president earlier this week. He will assume the role, pending shareholder approval, in June.
Meanwhile, Toyota is said to be considering voluntary layoffs at its U.K. and North American operations, Reuters reports.
The cuts, which likely will be achieved through early-retirement offers, are to include 1,000 workers.
A Toyota North America spokesman is quoted as saying no involuntary layoffs are being considered by the auto maker at this time.
Toyota’s sales worldwide, including the U.S., its largest and most-profitable market, have been falling steadily as the auto maker, which just passed General Motors Corp. for the No.1 global sales title, succumbs to the ongoing economic slowdown.
Toyota repeatedly has adjusted vehicle output at its plants worldwide, as well as cut temporary workers at the manufacturing level and at its U.S. sales arm.
02-16-09, 07:52 AM
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A lengthy New York Times article on Akio Toyoda
Taking the Wheel as Toyota Skids
By MICHELINE MAYNARD
The Japanese phrase genchi genbutsu translates as “go to the spot” — in other words, “see it for yourself.” Few executives embrace that philosophy as completely as Akio Toyoda, who is slated to become the next president of the Toyota Motor Corporation.
Last summer, during a trip so secret that Toyota’s public relations staff didn’t know he was here, Mr. Toyoda visited a dealership in Ann Arbor, Mich., and decided to satisfy his curiosity about a pickup truck recall.
Still wearing his business suit, he got down on his hands and knees on the warm blacktop to examine the undercarriage of one of the trucks, shocking his American hosts, who didn’t expect a corporate V.I.P. to be so hands-on.
They, and everyone else at Toyota, had better get used to it.
In June, Mr. Toyoda will take charge of a renowned company facing its most serious setback since a crisis in the early 1950s forced his grandfather, Kiichiro Toyoda, to give up control of the carmaker he founded in 1937.
The momentum that allowed Toyota to become the world’s biggest and richest carmaker is screeching to a halt. It’s set to report billion-dollar losses for 2008, a stunning reversal from the record annual profits it earned earlier this decade.
In the United States, its biggest car market, unsold Toyotas are piling up on storage lots while dealers, once used to waiting lists of eager customers, grapple with sales that have plunged by a third.
Inside Toyota, the situation is being referred to as “the emergency,” with top management canceling routine meetings and trips to focus on overcoming a global auto slump. On Thursday, Toyota said worker buyouts, possibly shorter workweeks and executive pay reductions would be part of urgent cost-cutting.
At a news conference last month announcing his appointment, Mr. Toyoda put managers on notice that he will pop up everywhere, just as he did in Ann Arbor. “I have assumed the huge responsibility of steering Toyota at a time when we’re facing a once-in-a-century crisis,” he said. “Given the circumstances, I take my responsibility very seriously.”
All of this is far more challenging than anyone at Toyota anticipated even a year ago. Early this month, Toyota forecast a $3.9 billion net loss for the 2008 fiscal year, which ends in March, the first time it has lost money since 1950. It expects an even deeper operating loss of about $5 billion, its first since it was founded.
The dismal financial news came only days after Toyota confirmed rumors that Mr. Toyoda, after a 25-year apprenticeship, would finally become its next president, replacing Katsuaki Watanabe, who has held the job since 2005, and who will become vice chairman.
The prospect of deep losses and the abrupt announcement that a Toyoda would return to power, after people from outside the family had run the company for 14 years, have jolted the auto giant in the same way that looming bankruptcy has rattled Detroit automakers.
“The financial crisis and the economy are intertwined, and the crisis is expanding significantly faster, wider and deeper than we expected,” Mr. Watanabe wrote in an e-mail message in response to questions.
Even before Mr. Watanabe hands off the top job at the company to Mr. Toyoda, pieces of Toyota’s response to the crisis are being rolled out.
Toyota, which has been on a steep growth curve this decade, has put new plants on hold, including a factory under construction in Blue Springs, Miss., that was supposed to open next year. The company plans to cut spending by 10 percent and is letting many temporary workers go; permanent workers thus far have been protected by a lifetime employment policy.
Toyota is also rethinking its lineup of cars for every region of the world and accelerating offerings of more environmentally friendly vehicles. And it’s already planning for 2030, when it envisions a world in which hybrid vehicles — and other types, like those that run on hydrogen — dominate the roads as traditional internal combustion engines fade in importance.
Toyota doesn’t plan to seek government support, either in Japan or elsewhere, Mr. Watanabe said. That fact alone illustrates the gap between Toyota and its American counterparts.
“G.M., Ford and Chrysler are trying to survive,” says John Paul MacDuffie, an associate professor of management at the Wharton School of the University of Pennsylvania. “All Toyota is trying to do is survive a downturn.”
To do so, Toyota will rely on someone who has been groomed for this job for much of his adult life.
Along with his last name, reminders of Mr. Toyoda’s heritage are ubiquitous in Japan. A bust of his look-alike grandfather sits in front of Toyota’s soaring glass headquarters in Toyota City, about 30 miles outside Nagoya.
The original office building where Toyota was founded is near Nagoya’s bustling train station, while the traditional Japanese home of the company patriarch, Sakichi Toyoda, is on display in Toyoda City.
These days, the Toyoda family — which spelled its companies’ names differently so they would be easier to write in Japanese characters — holds only a small fraction of Toyota stock.
But the family still wields a powerful influence at Toyota. Mr. Toyoda insists that nepotism was not behind his elevation, and he is also quick to point out that he is captive to his family’s legacy.
“I really did not have a choice to be born with the Toyoda surname,” he said on the day he was named as Toyota’s next president.
Even if his last name were different, Mr. Toyoda’s appointment would set him apart, however. At 52, he is still relatively young to become a Japanese chief executive. (Mr. Watanabe, who turned 67 on Friday, was 63 when he was promoted.)
Mr. Toyoda is fluent in English, perfected when he earned his M.B.A. at Babson College in Wellesley, Mass., and during the years he spent in New York, working as an investment banker and management consultant and living around the corner from the Frick Collection.
Unlike other Japanese executives, who rely on interpreters even when they understand a foreign language, Mr. Toyoda is content to operate in English, using it in speeches, interviews and, according to Professor MacDuffie, even at the training programs that Wharton conducts in Japan.
At one recent Wharton session, Mr. Toyoda cracked jokes and eschewed a formal presentation for an off-the-cuff talk. He seemed “very much a part of the younger generation,” Professor MacDuffie said.
Not surprisingly, Toyota’s American executives, who are struggling with their deepest sales decline in a generation, can’t wait for him to take charge.
“Akio is a very, very good leader,” says James Lentz, president of Toyota Motor Sales U.S.A., the company’s sales arm here. “He’s passionate about the company, and passionate about the people at the company.”
Mr. Lentz met Mr. Toyoda in 1995, when he was general manager of Toyota’s San Francisco region, and Mr. Toyoda was a planner and administrator at a plant in Fremont, Calif., that was a joint venture with General Motors.
Late one Friday night, there was a quiet knock on Mr. Lentz’s office door. Not expecting a guest, he opened it to find Mr. Toyoda, who had come from Fremont to pick up a car to use for the weekend.
Mr. Lentz got another surprise when he discovered that Mr. Toyoda was accompanied by his father, Shoichiro, then Toyota’s chairman, who had traveled to America, unannounced, to visit his son.
Drop-ins continue to be part of Mr. Toyoda’s routine. In recent months, he has frequently called on Mark Templin, the general manager of Toyota’s Lexus luxury division, and one of the company’s most prominent American leaders, to discuss the future of Lexus.
In January, Toyota announced that Lexus would develop its first vehicle to be exclusively designed as a hybrid. Mr. Templin hinted that other dedicated hybrids, and perhaps a premium small car like the Mini Cooper, also may be in store for Lexus.
Mr. Templin, who regularly visits Mr. Toyoda in Japan, describes the Toyota headquarters desk of his boss as “full of paper.” Mr. Toyoda’s office is much smaller than those favored by American chief executives, says Mr. Templin, who adds that he has been impressed by Mr. Toyoda’s effort over decades to learn all aspects of the company’s operations.
Along with his assignment at the Fremont joint venture, Mr. Toyoda has run Toyota’s operations in China and Japan and started a Web site aimed at young Japanese consumers called Gazoo.com. The site, originally meant as a way to market Toyota’s used cars, has since morphed into a popular social network.
Mr. Toyoda was named to the company board in 2000, which put him in regular contact with all of Toyota’s senior leaders, and joined their ranks in 2005, when he became an executive vice president. (The ascent hasn’t been without a few glitches. Not long after becoming a board member, Mr. Toyoda lost the gold lapel pin bearing the original Toyota emblem that all directors wear each day. His status as a family member won him no special treatment, he confided last year in an interview: like everyone else, he had to pay for a replacement.)
Mr. Toyoda also acquired a deep interest in his company’s automobiles, spending hours each month for the last decade testing new cars. In 2007, he even drove a four-hour stint as part of a Toyota racing team in Germany.
“The Toyoda family is still kind of golden” in Japan, says Jeffrey K. Liker, an engineering professor at the University of Michigan and the author of a series of books about Toyota. “The president is the face of the company, and this time, it may be important to have the right kind of face.”
Although Mr. Toyoda plans to respect Toyota’s corporate traditions as the company’s new president, he intends to be his own man.
“I also will not be tied to the past,” he said during the news conference. “I will do my utmost to be as bold as possible.”
His first moves are expected to include naming a new management team. One adviser could be Yoshi Inaba, the former head of Toyota’s North American operations.
Also fluent in English, Mr. Inaba played a role in Mr. Toyoda’s tutelage and became a familiar figure with Toyota’s dealers in the United States. Once considered a leading candidate to become president himself, Mr. Inaba left Toyota to become an airport executive after he lost the job to Mr. Watanabe.
Mr. Toyoda also is expected to call on his father for advice, although Shoichiro Toyoda is expected to leave Toyota’s board when his son becomes president. (Inside Toyota, Mr. Toyoda is called Akio-san to distinguish him from his father, now a robust 84, who is known as Dr. Toyoda or merely Dr. T.)
The relationship between the two men has not always been easy. Mr. Toyoda, who is Shoichiro Toyoda’s only son (he has one sister), did not show an interest in joining the company until he was 28, or several years after most new hires.
Mr. Toyoda, whose father was president from 1982 to 1992, said in an interview in Toyota City last year that he had a complex, dual relationship with the man who was both his father and his supervisor at Toyota.
But senior company executives, who asked not to be identified because they were not authorized to speak for the company about board matters, speculated that there were two reasons the father believed the time was right for his son’s promotion: The elder Mr. Toyoda wants to be in good health when his son takes over so he can provide counsel, and he wants his son to manage the company through a downturn, and potentially enjoy the reputational benefits of a rebound.
Akio Toyoda is not expected to turn the company upside down. Toyota is governed by a series of management principles that collectively represent the “Toyota Way” — practices that focus on consensus management, continuous production improvements and in-depth investigations before any strategic shifts occur.
For all of its sophistication as a company, Toyota embarked on its global expansion only about a decade ago. Two successive presidents, Hiroshi Okuda and Fujio Cho, who preceded Mr. Watanabe, set the company on a trajectory that made it the world’s largest auto company, a title it took from G.M. last year.
Mr. Watanabe continued the push during the last few years, opening new plants in Texas and Ontario, and starting construction on the plant in Mississippi.
But critics say Mr. Watanabe misjudged the economic downturn, and shouldn’t have pursued new initiatives like the Mississippi factory. Mr. Watanabe, however, insists the factory, intended to build the hybrid-electric Prius, was not a mistake.
He said by e-mail that Toyota still expected the American market to grow, and that there was “no doubt” that it will recover at some point. “For this reason, Toyota believes its investment in the Mississippi plant is essential,” he said.
Even though it cut Toyota’s debt rating this month, Standard & Poor’s Ratings Services said the company could withstand a one- to two-year sales slump, as long as its cash, believed to be around $55 billion, holds out.
“Toyota boasts a formidable degree of competitiveness among global auto manufacturers,” Osamu Kobayashi, an analyst with the agency, said in a research report. “We view Toyota as being better positioned than other global auto manufacturers to cope.”
During Mr. Watanabe’s tenure, Toyota posted successive years of record profits, including about $18.8 billion in earnings in 2007. At that time, Toyota had a market capitalization of nearly $200 billion; it’s now about half that, but still dwarfs all of the Detroit auto companies combined.
Some of Mr. Watanabe’s other efforts will make it easier for Mr. Toyoda to run things. He revamped quality controls after a spate of recalls and reorganized engineering operations to design cars for a global marketplace rather than simply taking Japanese models and adapting them for buyers overseas.
Mr. Watanabe cites 11 research and development centers around the world, including a new safety facility in Ann Arbor, as important parts of his legacy.
“Toyota’s R.& D. investment is based on expected returns over the medium to long term, rather than from a short-term perspective,” he said. “Technology, including design and product development, is necessary for Toyota’s growth.”
Mr. Watanabe, long an advocate for environmentally friendly vehicles, said Toyota was watching how the world’s governments act on climate change.
“Toyota does expect that policies that promote growth with a balance between economics and the environment, such as the Obama administration’s green initiatives, will be implemented not only in the U.S. but also in other countries around the world,” he said.
As Mr. Toyoda prepares to become president, one critical change awaits: opening Toyota’s management doors to outsiders.
Despite its rapid growth in the United States and Europe, and an increasingly global viewpoint, Toyota remains a Japan-centric company, dominated by Japanese managers, who have yet to give significant, lasting authority to their foreign counterparts.
Two Americans who rose to high-ranking positions this decade — James E. Press and Gary L. Convis — left for top jobs at other companies, Mr. Press at Chrysler and Mr. Convis at the Dana Holding Corporation, an auto supplier.
Mr. Toyoda, schooled overseas, may push for more diversity, says Professor Liker. He also expects Mr. Toyoda to be a much more visible presence internationally than Mr. Watanabe, who never had a major assignment outside Japan before becoming president and made relatively few trips overseas while in the job.
By contrast, Mr. Toyoda’s learning curve has included trips to Washington. And he has dined with influential lawmakers like Senator John D. Rockefeller IV, a friend of his father and a West Virginia Democrat whose state is home to a Toyota engine plant.
Professor Liker predicts that Mr. Toyoda will be a globe trotter. Beyond that, his ascent signals that his family wants to return to basics as it confronts an uncertain future.
Despite the gloom surrounding the industry, Mr. Toyoda has the opportunity to “take everything that looks bad, and use it as an opportunity to learn,” Professor MacDuffie said.
http://www.nytimes.com/2009/02/15/bu...pagewanted=all
By MICHELINE MAYNARD
The Japanese phrase genchi genbutsu translates as “go to the spot” — in other words, “see it for yourself.” Few executives embrace that philosophy as completely as Akio Toyoda, who is slated to become the next president of the Toyota Motor Corporation.
Last summer, during a trip so secret that Toyota’s public relations staff didn’t know he was here, Mr. Toyoda visited a dealership in Ann Arbor, Mich., and decided to satisfy his curiosity about a pickup truck recall.
Still wearing his business suit, he got down on his hands and knees on the warm blacktop to examine the undercarriage of one of the trucks, shocking his American hosts, who didn’t expect a corporate V.I.P. to be so hands-on.
They, and everyone else at Toyota, had better get used to it.
In June, Mr. Toyoda will take charge of a renowned company facing its most serious setback since a crisis in the early 1950s forced his grandfather, Kiichiro Toyoda, to give up control of the carmaker he founded in 1937.
The momentum that allowed Toyota to become the world’s biggest and richest carmaker is screeching to a halt. It’s set to report billion-dollar losses for 2008, a stunning reversal from the record annual profits it earned earlier this decade.
In the United States, its biggest car market, unsold Toyotas are piling up on storage lots while dealers, once used to waiting lists of eager customers, grapple with sales that have plunged by a third.
Inside Toyota, the situation is being referred to as “the emergency,” with top management canceling routine meetings and trips to focus on overcoming a global auto slump. On Thursday, Toyota said worker buyouts, possibly shorter workweeks and executive pay reductions would be part of urgent cost-cutting.
At a news conference last month announcing his appointment, Mr. Toyoda put managers on notice that he will pop up everywhere, just as he did in Ann Arbor. “I have assumed the huge responsibility of steering Toyota at a time when we’re facing a once-in-a-century crisis,” he said. “Given the circumstances, I take my responsibility very seriously.”
All of this is far more challenging than anyone at Toyota anticipated even a year ago. Early this month, Toyota forecast a $3.9 billion net loss for the 2008 fiscal year, which ends in March, the first time it has lost money since 1950. It expects an even deeper operating loss of about $5 billion, its first since it was founded.
The dismal financial news came only days after Toyota confirmed rumors that Mr. Toyoda, after a 25-year apprenticeship, would finally become its next president, replacing Katsuaki Watanabe, who has held the job since 2005, and who will become vice chairman.
The prospect of deep losses and the abrupt announcement that a Toyoda would return to power, after people from outside the family had run the company for 14 years, have jolted the auto giant in the same way that looming bankruptcy has rattled Detroit automakers.
“The financial crisis and the economy are intertwined, and the crisis is expanding significantly faster, wider and deeper than we expected,” Mr. Watanabe wrote in an e-mail message in response to questions.
Even before Mr. Watanabe hands off the top job at the company to Mr. Toyoda, pieces of Toyota’s response to the crisis are being rolled out.
Toyota, which has been on a steep growth curve this decade, has put new plants on hold, including a factory under construction in Blue Springs, Miss., that was supposed to open next year. The company plans to cut spending by 10 percent and is letting many temporary workers go; permanent workers thus far have been protected by a lifetime employment policy.
Toyota is also rethinking its lineup of cars for every region of the world and accelerating offerings of more environmentally friendly vehicles. And it’s already planning for 2030, when it envisions a world in which hybrid vehicles — and other types, like those that run on hydrogen — dominate the roads as traditional internal combustion engines fade in importance.
Toyota doesn’t plan to seek government support, either in Japan or elsewhere, Mr. Watanabe said. That fact alone illustrates the gap between Toyota and its American counterparts.
“G.M., Ford and Chrysler are trying to survive,” says John Paul MacDuffie, an associate professor of management at the Wharton School of the University of Pennsylvania. “All Toyota is trying to do is survive a downturn.”
To do so, Toyota will rely on someone who has been groomed for this job for much of his adult life.
Along with his last name, reminders of Mr. Toyoda’s heritage are ubiquitous in Japan. A bust of his look-alike grandfather sits in front of Toyota’s soaring glass headquarters in Toyota City, about 30 miles outside Nagoya.
The original office building where Toyota was founded is near Nagoya’s bustling train station, while the traditional Japanese home of the company patriarch, Sakichi Toyoda, is on display in Toyoda City.
These days, the Toyoda family — which spelled its companies’ names differently so they would be easier to write in Japanese characters — holds only a small fraction of Toyota stock.
But the family still wields a powerful influence at Toyota. Mr. Toyoda insists that nepotism was not behind his elevation, and he is also quick to point out that he is captive to his family’s legacy.
“I really did not have a choice to be born with the Toyoda surname,” he said on the day he was named as Toyota’s next president.
Even if his last name were different, Mr. Toyoda’s appointment would set him apart, however. At 52, he is still relatively young to become a Japanese chief executive. (Mr. Watanabe, who turned 67 on Friday, was 63 when he was promoted.)
Mr. Toyoda is fluent in English, perfected when he earned his M.B.A. at Babson College in Wellesley, Mass., and during the years he spent in New York, working as an investment banker and management consultant and living around the corner from the Frick Collection.
Unlike other Japanese executives, who rely on interpreters even when they understand a foreign language, Mr. Toyoda is content to operate in English, using it in speeches, interviews and, according to Professor MacDuffie, even at the training programs that Wharton conducts in Japan.
At one recent Wharton session, Mr. Toyoda cracked jokes and eschewed a formal presentation for an off-the-cuff talk. He seemed “very much a part of the younger generation,” Professor MacDuffie said.
Not surprisingly, Toyota’s American executives, who are struggling with their deepest sales decline in a generation, can’t wait for him to take charge.
“Akio is a very, very good leader,” says James Lentz, president of Toyota Motor Sales U.S.A., the company’s sales arm here. “He’s passionate about the company, and passionate about the people at the company.”
Mr. Lentz met Mr. Toyoda in 1995, when he was general manager of Toyota’s San Francisco region, and Mr. Toyoda was a planner and administrator at a plant in Fremont, Calif., that was a joint venture with General Motors.
Late one Friday night, there was a quiet knock on Mr. Lentz’s office door. Not expecting a guest, he opened it to find Mr. Toyoda, who had come from Fremont to pick up a car to use for the weekend.
Mr. Lentz got another surprise when he discovered that Mr. Toyoda was accompanied by his father, Shoichiro, then Toyota’s chairman, who had traveled to America, unannounced, to visit his son.
Drop-ins continue to be part of Mr. Toyoda’s routine. In recent months, he has frequently called on Mark Templin, the general manager of Toyota’s Lexus luxury division, and one of the company’s most prominent American leaders, to discuss the future of Lexus.
In January, Toyota announced that Lexus would develop its first vehicle to be exclusively designed as a hybrid. Mr. Templin hinted that other dedicated hybrids, and perhaps a premium small car like the Mini Cooper, also may be in store for Lexus.
Mr. Templin, who regularly visits Mr. Toyoda in Japan, describes the Toyota headquarters desk of his boss as “full of paper.” Mr. Toyoda’s office is much smaller than those favored by American chief executives, says Mr. Templin, who adds that he has been impressed by Mr. Toyoda’s effort over decades to learn all aspects of the company’s operations.
Along with his assignment at the Fremont joint venture, Mr. Toyoda has run Toyota’s operations in China and Japan and started a Web site aimed at young Japanese consumers called Gazoo.com. The site, originally meant as a way to market Toyota’s used cars, has since morphed into a popular social network.
Mr. Toyoda was named to the company board in 2000, which put him in regular contact with all of Toyota’s senior leaders, and joined their ranks in 2005, when he became an executive vice president. (The ascent hasn’t been without a few glitches. Not long after becoming a board member, Mr. Toyoda lost the gold lapel pin bearing the original Toyota emblem that all directors wear each day. His status as a family member won him no special treatment, he confided last year in an interview: like everyone else, he had to pay for a replacement.)
Mr. Toyoda also acquired a deep interest in his company’s automobiles, spending hours each month for the last decade testing new cars. In 2007, he even drove a four-hour stint as part of a Toyota racing team in Germany.
“The Toyoda family is still kind of golden” in Japan, says Jeffrey K. Liker, an engineering professor at the University of Michigan and the author of a series of books about Toyota. “The president is the face of the company, and this time, it may be important to have the right kind of face.”
Although Mr. Toyoda plans to respect Toyota’s corporate traditions as the company’s new president, he intends to be his own man.
“I also will not be tied to the past,” he said during the news conference. “I will do my utmost to be as bold as possible.”
His first moves are expected to include naming a new management team. One adviser could be Yoshi Inaba, the former head of Toyota’s North American operations.
Also fluent in English, Mr. Inaba played a role in Mr. Toyoda’s tutelage and became a familiar figure with Toyota’s dealers in the United States. Once considered a leading candidate to become president himself, Mr. Inaba left Toyota to become an airport executive after he lost the job to Mr. Watanabe.
Mr. Toyoda also is expected to call on his father for advice, although Shoichiro Toyoda is expected to leave Toyota’s board when his son becomes president. (Inside Toyota, Mr. Toyoda is called Akio-san to distinguish him from his father, now a robust 84, who is known as Dr. Toyoda or merely Dr. T.)
The relationship between the two men has not always been easy. Mr. Toyoda, who is Shoichiro Toyoda’s only son (he has one sister), did not show an interest in joining the company until he was 28, or several years after most new hires.
Mr. Toyoda, whose father was president from 1982 to 1992, said in an interview in Toyota City last year that he had a complex, dual relationship with the man who was both his father and his supervisor at Toyota.
But senior company executives, who asked not to be identified because they were not authorized to speak for the company about board matters, speculated that there were two reasons the father believed the time was right for his son’s promotion: The elder Mr. Toyoda wants to be in good health when his son takes over so he can provide counsel, and he wants his son to manage the company through a downturn, and potentially enjoy the reputational benefits of a rebound.
Akio Toyoda is not expected to turn the company upside down. Toyota is governed by a series of management principles that collectively represent the “Toyota Way” — practices that focus on consensus management, continuous production improvements and in-depth investigations before any strategic shifts occur.
For all of its sophistication as a company, Toyota embarked on its global expansion only about a decade ago. Two successive presidents, Hiroshi Okuda and Fujio Cho, who preceded Mr. Watanabe, set the company on a trajectory that made it the world’s largest auto company, a title it took from G.M. last year.
Mr. Watanabe continued the push during the last few years, opening new plants in Texas and Ontario, and starting construction on the plant in Mississippi.
But critics say Mr. Watanabe misjudged the economic downturn, and shouldn’t have pursued new initiatives like the Mississippi factory. Mr. Watanabe, however, insists the factory, intended to build the hybrid-electric Prius, was not a mistake.
He said by e-mail that Toyota still expected the American market to grow, and that there was “no doubt” that it will recover at some point. “For this reason, Toyota believes its investment in the Mississippi plant is essential,” he said.
Even though it cut Toyota’s debt rating this month, Standard & Poor’s Ratings Services said the company could withstand a one- to two-year sales slump, as long as its cash, believed to be around $55 billion, holds out.
“Toyota boasts a formidable degree of competitiveness among global auto manufacturers,” Osamu Kobayashi, an analyst with the agency, said in a research report. “We view Toyota as being better positioned than other global auto manufacturers to cope.”
During Mr. Watanabe’s tenure, Toyota posted successive years of record profits, including about $18.8 billion in earnings in 2007. At that time, Toyota had a market capitalization of nearly $200 billion; it’s now about half that, but still dwarfs all of the Detroit auto companies combined.
Some of Mr. Watanabe’s other efforts will make it easier for Mr. Toyoda to run things. He revamped quality controls after a spate of recalls and reorganized engineering operations to design cars for a global marketplace rather than simply taking Japanese models and adapting them for buyers overseas.
Mr. Watanabe cites 11 research and development centers around the world, including a new safety facility in Ann Arbor, as important parts of his legacy.
“Toyota’s R.& D. investment is based on expected returns over the medium to long term, rather than from a short-term perspective,” he said. “Technology, including design and product development, is necessary for Toyota’s growth.”
Mr. Watanabe, long an advocate for environmentally friendly vehicles, said Toyota was watching how the world’s governments act on climate change.
“Toyota does expect that policies that promote growth with a balance between economics and the environment, such as the Obama administration’s green initiatives, will be implemented not only in the U.S. but also in other countries around the world,” he said.
As Mr. Toyoda prepares to become president, one critical change awaits: opening Toyota’s management doors to outsiders.
Despite its rapid growth in the United States and Europe, and an increasingly global viewpoint, Toyota remains a Japan-centric company, dominated by Japanese managers, who have yet to give significant, lasting authority to their foreign counterparts.
Two Americans who rose to high-ranking positions this decade — James E. Press and Gary L. Convis — left for top jobs at other companies, Mr. Press at Chrysler and Mr. Convis at the Dana Holding Corporation, an auto supplier.
Mr. Toyoda, schooled overseas, may push for more diversity, says Professor Liker. He also expects Mr. Toyoda to be a much more visible presence internationally than Mr. Watanabe, who never had a major assignment outside Japan before becoming president and made relatively few trips overseas while in the job.
By contrast, Mr. Toyoda’s learning curve has included trips to Washington. And he has dined with influential lawmakers like Senator John D. Rockefeller IV, a friend of his father and a West Virginia Democrat whose state is home to a Toyota engine plant.
Professor Liker predicts that Mr. Toyoda will be a globe trotter. Beyond that, his ascent signals that his family wants to return to basics as it confronts an uncertain future.
Despite the gloom surrounding the industry, Mr. Toyoda has the opportunity to “take everything that looks bad, and use it as an opportunity to learn,” Professor MacDuffie said.
http://www.nytimes.com/2009/02/15/bu...pagewanted=all
02-16-09, 03:35 PM
#18
Fascinating read, thanks for posting. All in all, he sounds like the right man of the job. As a public face, and setting the tone for the company, it looks good on paper. The question is whether he will be able to deliver. The 'emergency' truly is an unprecedented challenge, and it would be wonderful if he were able to turn things around and advance his tenure as company president in a successful direction.
02-16-09, 07:10 PM
#21
Lexus Champion
Great read, good to read what people have to say about from a different pespective.
06-19-09, 05:23 AM
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Another Akio Toyoda article
Toyota resumes family leadership: Grandson to head top carmaker
by Christine Tierney / The Detroit News
For the first time in 14 years, Toyota Motor Corp. has turned to the family of founder Kiichiro Toyoda for its next president.
Akio Toyoda, Kiichiro's grandson, is expected to take up his new responsibilities Tuesday, after Toyota's shareholders vote on top management appointments, including his promotion after 25 years with the company. Toyoda, 53, has held a variety of jobs, not only in Japan, but also in the United States and China.
Yet in spite of the company's assiduous efforts to groom him and prepare a trouble-free transition for the scion of the Toyoda family, Akio Toyoda is taking the wheel at a tremendously challenging time for the world's largest automaker.
Toyota just lost $7.7 billion in the three months ending March 31 -- the biggest quarterly loss in its history -- because of a devastating downturn in global demand that has not spared any automaker.
The company expects to run up further losses in the fiscal year begun on April 1 as it confronts a situation familiar to most automakers but new to Toyota -- having more people and plants than it needs.
"The issues that confront Akio are more substantial than any Toyota has faced in its history," said Maryann Keller, an industry analyst who heads her own consulting firm in Stamford, Conn. "Akio is facing massive global excess capacity, the emergence of South Korean competitors and the potential emergence of Chinese competitors."
Toyota faces crucial technological choices after concentrating on gas-electric hybrids. It is now struggling to develop new, less-expensive ways to make small cars and curtail costs without laying off permanent workers.
The challenges have led some analysts to question whether the company might be wiser to tap a more hardened, less cosseted executive to run the company.
Although Akio Toyoda has a great deal of experience, industry experts say it's difficult to assess his performance. "If you bear the last name of the company -- like Ford -- are you ever challenged in your career?" Keller said. "Are you ever held to task for making the wrong decision?"
But the powers-that-be at Toyota, a small group of current and former leaders that includes Akio's father, Honorary Chairman Shoichiro Toyoda, concluded that Akio was ready.
The family wields great influence even though it holds little stock -- less than 5 percent, according to analysts' estimates.
Akio's grandfather, Kiichiro, founded the carmaker in 1937, choosing the name Toyota, which has a more auspicious number of calligraphy strokes than the family's name.
Several family members, including Kiichiro's cousin, Eiji Toyoda, and his son, Shoichiro, were presidents. Ever since Akio Toyoda joined the company in 1984, his colleagues anticipated he might someday head Toyota.
His credentials are impressive. Unlike most of his predecessors, Akio Toyoda speaks fluent English. He earned an MBA from Babson College in Massachusetts, in addition to a law degree from Tokyo's Keio University.
"He's a smart guy. He's got a Western education, and a global view," said David Cole, chairman of the Center for Automotive Research, who met Akio Toyoda in the late 1990s. Toyoda was then vice president at New United Motor Manufacturing Inc., Toyota's joint venture with General Motors Corp. in Fremont, Calif.
"He's not going to dictate from the top," Cole said. "He's someone who recognizes that he doesn't know everything."
Akio Toyoda was rumored in 2005 to be a candidate for president. When the job went to purchasing chief Katsuaki Watanabe, insiders described the new boss as a place-holder who would run Toyota for only a few years.
People who know Akio Toyoda say he is friendly, outgoing and not afraid to take risks. He likes racing and has participated in famous contests, including the German Nürburgring 24-hour Endurance Race. He finished 87th last month out of about 170 competing cars.
He travels often to visit dealers and executives. "He has a sense of energy and a sense of optimism about the future that I think is infectious," said Mark Templin, general manager of Lexus, Toyota's luxury brand, in Torrance, Calif.
In April, Akio Toyoda met with the automaker's top 60 U.S. dealers at a dinner in Washington, D.C., accompanied by Yoshi Inaba, a former Toyota sales executive whom he rehired to help run the crucial U.S. operations.
"They're always very motivating," said Tammy Darvish, vice president of Darcars Automotive Group, a big dealer company based in Maryland. "You really believe they're genuinely concerned about your feedback."
In addition to bringing back Inaba, Akio Toyoda is putting trusted associates in key positions. His inner circle comprises managers with sales or manufacturing experience, such as Yuki Funo, Toyota Motor Sales' chairman who is moving back to Japan as executive vice president. Toyoda is said to be leery of putting financial experts in charge.
But even as he is establishing a solid base of support, it's not clear who, aside from his father, would challenge his decisions.
Japanese boards don't have the same responsibilities as U.S. boards. "Japanese boards don't even make a pretense of being independent and have no authority to engage the CEO in rancorous debate," Keller said.
At Toyota, many key decisions are made at nebulous levels by top and former top executives who stay on as advisers.
Now in his 80s, Shoichiro Toyoda plans to retire this month as honorary chairman. Hiroshi Okuda, a hard-driving former president, is relinquishing his post as senior adviser. But people who know the company say the old-timers won't be too far away.
More information
Akio Toyoda
Position: Nominated to be president of Toyota Motor Corp.
Age: 53
Education: Earned a law degree from Keio University in Tokyo, in 1979. Obtained an MBA from Babson College in Massachusetts, in 1982.
Career: Joined Toyota Motor Corp., assigned to the Motomachi Plant administration division, in 1984. After several jobs in Japan, including sales manager for dealers, Toyoda became VP of New United Motor Manufacturing Inc., Toyota's venture in California with GM, 1998. Appointed project general manager of Gazoo Internet business division in 2000. Appointed director of Asia & China Operations Center in 2001 and senior managing director in 2003. Promoted to executive VP in 2005. Became executive vice president for sales, mainly in Japan, in 2007, and took responsibility for overseas operations in 2008. Married to Hiroko, with a son and daughter.
http://detnews.com/article/20090619/...d+top+carmaker
by Christine Tierney / The Detroit News
For the first time in 14 years, Toyota Motor Corp. has turned to the family of founder Kiichiro Toyoda for its next president.
Akio Toyoda, Kiichiro's grandson, is expected to take up his new responsibilities Tuesday, after Toyota's shareholders vote on top management appointments, including his promotion after 25 years with the company. Toyoda, 53, has held a variety of jobs, not only in Japan, but also in the United States and China.
Yet in spite of the company's assiduous efforts to groom him and prepare a trouble-free transition for the scion of the Toyoda family, Akio Toyoda is taking the wheel at a tremendously challenging time for the world's largest automaker.
Toyota just lost $7.7 billion in the three months ending March 31 -- the biggest quarterly loss in its history -- because of a devastating downturn in global demand that has not spared any automaker.
The company expects to run up further losses in the fiscal year begun on April 1 as it confronts a situation familiar to most automakers but new to Toyota -- having more people and plants than it needs.
"The issues that confront Akio are more substantial than any Toyota has faced in its history," said Maryann Keller, an industry analyst who heads her own consulting firm in Stamford, Conn. "Akio is facing massive global excess capacity, the emergence of South Korean competitors and the potential emergence of Chinese competitors."
Toyota faces crucial technological choices after concentrating on gas-electric hybrids. It is now struggling to develop new, less-expensive ways to make small cars and curtail costs without laying off permanent workers.
The challenges have led some analysts to question whether the company might be wiser to tap a more hardened, less cosseted executive to run the company.
Although Akio Toyoda has a great deal of experience, industry experts say it's difficult to assess his performance. "If you bear the last name of the company -- like Ford -- are you ever challenged in your career?" Keller said. "Are you ever held to task for making the wrong decision?"
But the powers-that-be at Toyota, a small group of current and former leaders that includes Akio's father, Honorary Chairman Shoichiro Toyoda, concluded that Akio was ready.
The family wields great influence even though it holds little stock -- less than 5 percent, according to analysts' estimates.
Akio's grandfather, Kiichiro, founded the carmaker in 1937, choosing the name Toyota, which has a more auspicious number of calligraphy strokes than the family's name.
Several family members, including Kiichiro's cousin, Eiji Toyoda, and his son, Shoichiro, were presidents. Ever since Akio Toyoda joined the company in 1984, his colleagues anticipated he might someday head Toyota.
His credentials are impressive. Unlike most of his predecessors, Akio Toyoda speaks fluent English. He earned an MBA from Babson College in Massachusetts, in addition to a law degree from Tokyo's Keio University.
"He's a smart guy. He's got a Western education, and a global view," said David Cole, chairman of the Center for Automotive Research, who met Akio Toyoda in the late 1990s. Toyoda was then vice president at New United Motor Manufacturing Inc., Toyota's joint venture with General Motors Corp. in Fremont, Calif.
"He's not going to dictate from the top," Cole said. "He's someone who recognizes that he doesn't know everything."
Akio Toyoda was rumored in 2005 to be a candidate for president. When the job went to purchasing chief Katsuaki Watanabe, insiders described the new boss as a place-holder who would run Toyota for only a few years.
People who know Akio Toyoda say he is friendly, outgoing and not afraid to take risks. He likes racing and has participated in famous contests, including the German Nürburgring 24-hour Endurance Race. He finished 87th last month out of about 170 competing cars.
He travels often to visit dealers and executives. "He has a sense of energy and a sense of optimism about the future that I think is infectious," said Mark Templin, general manager of Lexus, Toyota's luxury brand, in Torrance, Calif.
In April, Akio Toyoda met with the automaker's top 60 U.S. dealers at a dinner in Washington, D.C., accompanied by Yoshi Inaba, a former Toyota sales executive whom he rehired to help run the crucial U.S. operations.
"They're always very motivating," said Tammy Darvish, vice president of Darcars Automotive Group, a big dealer company based in Maryland. "You really believe they're genuinely concerned about your feedback."
In addition to bringing back Inaba, Akio Toyoda is putting trusted associates in key positions. His inner circle comprises managers with sales or manufacturing experience, such as Yuki Funo, Toyota Motor Sales' chairman who is moving back to Japan as executive vice president. Toyoda is said to be leery of putting financial experts in charge.
But even as he is establishing a solid base of support, it's not clear who, aside from his father, would challenge his decisions.
Japanese boards don't have the same responsibilities as U.S. boards. "Japanese boards don't even make a pretense of being independent and have no authority to engage the CEO in rancorous debate," Keller said.
At Toyota, many key decisions are made at nebulous levels by top and former top executives who stay on as advisers.
Now in his 80s, Shoichiro Toyoda plans to retire this month as honorary chairman. Hiroshi Okuda, a hard-driving former president, is relinquishing his post as senior adviser. But people who know the company say the old-timers won't be too far away.
More information
Akio Toyoda
Position: Nominated to be president of Toyota Motor Corp.
Age: 53
Education: Earned a law degree from Keio University in Tokyo, in 1979. Obtained an MBA from Babson College in Massachusetts, in 1982.
Career: Joined Toyota Motor Corp., assigned to the Motomachi Plant administration division, in 1984. After several jobs in Japan, including sales manager for dealers, Toyoda became VP of New United Motor Manufacturing Inc., Toyota's venture in California with GM, 1998. Appointed project general manager of Gazoo Internet business division in 2000. Appointed director of Asia & China Operations Center in 2001 and senior managing director in 2003. Promoted to executive VP in 2005. Became executive vice president for sales, mainly in Japan, in 2007, and took responsibility for overseas operations in 2008. Married to Hiroko, with a son and daughter.
http://detnews.com/article/20090619/...d+top+carmaker
06-23-09, 06:50 AM
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As Akio Toyoda finally takes the helm at Toyota, here's an informative article from Automotive News:
Family scion takes helm of Toyota amid management shakeup
Former president Watanabe apologizes to shareholders
by Hans Greimel
TOKYO -- Akio Toyoda was approved as the new president of Toyota Motor Corp. today as part of a top management shuffle that elevates a veteran executive to head North American sales.
Toyoda, the 53-year-old grandson of the automaker's founder, leads a new board room that has been reorganized to put decision-making closer to the field.
The company's five executive vice presidents now have regional responsibilities in addition to the functional responsibilities that comprised their portfolios before.
"Some of the changes will make it easier for decision making in the field at levels of senior managing director and below," Toyota spokesman Paul Nolasco said.
Toyota shareholders approved the overhaul at their annual meeting as the company reels from its first operating loss in 71 years and looks to the founding family for leadership.
In North America, Toyota has called back Yoshimi Inaba, who was CEO of Toyota Motor Sales U.S.A. from 1999 to 2003. He will be based in the United States and head up sales and government relations, Nolasco said. Inaba will report to Atsushi Niimi, who was promoted from purchasing chief to executive vice president in charge of North America.
Niimi also was tapped to head Toyota's global production operations. Inaba returns to Toyota after leaving in 2007 to run an international airport in Nagoya, Japan, near Toyota's headquarters.
The former head the Americas Operations Group, Yukitoshi Funo, was also promoted to lead global operations in the Middle East, Africa, Latin America, China and Asia.
Also advancing is Steve St. Angelo, president of Toyota Motor Manufacturing Kentucky Inc. He will keep that position and take on new responsibilities as executive vice president of Toyota Motor Engineering and Manufacturing North America Inc.
He will be TEMA's third executive vice president, serving at the same time as Real Tanguay and Shigeki Terashi.
Hard times persist
Toyoda faces the company's worst industry downturn in its history.
The industry slump, fueled by tight credit, volatile fuel prices and rising jobless numbers, already has led U.S. rivals General Motors and Chrysler into bankruptcy.
"We expect to face continued hardship in our business environment for the near term, despite signs of recovery in some areas," departing President Katsuaki Watanabe told shareholders, adding that the company would try to achieve deeper cost cuts than planned.
"We are sorry to have worried our shareholders," he said.
At a board meeting following the shareholders' meeting, Watanabe was confirmed as vice chairman along with the other management changes.
Quick climb to the top
Toyoda had long been seen as a candidate to head the company founded by his grandfather in 1937 as he rose through the ranks at nearly twice the speed as his predecessor.
Toyoda and his new management team are scheduled to hold a news conference in Tokyo on Thursday.
Amid a global recession that has hammered car sales, Toyota's factories are severely underused. Making matters worse, Toyota builds about half of its vehicles in Japan, which works against it with the dollar squarely below 100 yen.
But unlike Chrysler and GM, which have closed plants, slashed jobs and shuttered dealerships in an effort to survive, Toyota has said it plans to ride out the downturn with its production capacity intact, arguing global vehicle demand will eventually recover.
"Erasing the losses is an urgent task but fundamentally, this company does things with a medium-term vision," said Tsuyoshi Mochimaru, an auto analyst at Barclays Capital.
"They're not going to suddenly change the way they do things to satisfy the short term. I expect the new management's strategy to be an extension of the previous one's," he said.
'Back to basics'
Shunning Western-style restructuring, Toyota has chosen to use the downtime to train workers. Already known as a lean operator, it is trying to squeeze costs further so it can be profitable using just 70 percent of its production capacity.
"A V-shaped recovery is actually not that difficult if you slash (capital expenditures) and jobs, for instance. Toyota could probably get a restructuring impact of close to 1 trillion yen. It's not that they can't do it -- they won't do it," Mochimaru said.
Toyoda has said he will steer the company "back to the basics" from a run of expansion in the past decade that Watanabe conceded may have been too fast.
Chairman Fujio Cho admitted in January that there was some hesitation about handing the baton to the relatively young Toyoda at such turbulent times, but said ultimately that a younger leader and the Toyoda name were the best hope for taking the "drastic measures" needed during the crisis.
But neither Cho nor Toyoda specified what those measures would entail, and analysts said they could be elusive anyway.
"A drastic reform at Toyota would involve cutting back its domestic production base," said Kurt Sanger, a Tokyo-based auto analyst at Deutsche Securities.
"But that probability is low. And with 50 percent of its production in Japan and the dollar at 95 yen, even if the U.S. market returns to 16 million units tomorrow, they'll still be making less profit than before."
Facing annual U.S. industry sales of around 10 million units, Toyota is expecting last year's operating loss, its first in seven decades, to balloon to 850 billion yen ($8.8 billion) in the year ending March 2010.
More competition
While analysts see Toyota's loss projection for this year as too cautious -- consensus forecasts put the loss at 495 billion yen -- they said returning to profit would be tough, and dependent on an economic recovery.
Even then, Toyota could face tougher competition as long as the yen stays relatively firm.
With most of its high-end Lexus cars produced in Japan, Toyota will either have to raise prices or accept lower margins. In contrast, a drop in the Korean won has made Hyundai Motor Co.'s cars more attractive and profitable.
The new, low-priced Prius hybrid launched last month has reversed the sales decline for that model, but risks eating into sales of its other, more profitable cars.
In contrast, analysts say Honda Motor Co.'s new low-cost Insight hybrid is relatively profitable, probably yielding higher margins than its Fit subcompact.
http://www.autonews.com/apps/pbcs.dl...73358134247728
Family scion takes helm of Toyota amid management shakeup
Former president Watanabe apologizes to shareholders
by Hans Greimel
TOKYO -- Akio Toyoda was approved as the new president of Toyota Motor Corp. today as part of a top management shuffle that elevates a veteran executive to head North American sales.
Toyoda, the 53-year-old grandson of the automaker's founder, leads a new board room that has been reorganized to put decision-making closer to the field.
The company's five executive vice presidents now have regional responsibilities in addition to the functional responsibilities that comprised their portfolios before.
"Some of the changes will make it easier for decision making in the field at levels of senior managing director and below," Toyota spokesman Paul Nolasco said.
Toyota shareholders approved the overhaul at their annual meeting as the company reels from its first operating loss in 71 years and looks to the founding family for leadership.
In North America, Toyota has called back Yoshimi Inaba, who was CEO of Toyota Motor Sales U.S.A. from 1999 to 2003. He will be based in the United States and head up sales and government relations, Nolasco said. Inaba will report to Atsushi Niimi, who was promoted from purchasing chief to executive vice president in charge of North America.
Niimi also was tapped to head Toyota's global production operations. Inaba returns to Toyota after leaving in 2007 to run an international airport in Nagoya, Japan, near Toyota's headquarters.
The former head the Americas Operations Group, Yukitoshi Funo, was also promoted to lead global operations in the Middle East, Africa, Latin America, China and Asia.
Also advancing is Steve St. Angelo, president of Toyota Motor Manufacturing Kentucky Inc. He will keep that position and take on new responsibilities as executive vice president of Toyota Motor Engineering and Manufacturing North America Inc.
He will be TEMA's third executive vice president, serving at the same time as Real Tanguay and Shigeki Terashi.
Hard times persist
Toyoda faces the company's worst industry downturn in its history.
The industry slump, fueled by tight credit, volatile fuel prices and rising jobless numbers, already has led U.S. rivals General Motors and Chrysler into bankruptcy.
"We expect to face continued hardship in our business environment for the near term, despite signs of recovery in some areas," departing President Katsuaki Watanabe told shareholders, adding that the company would try to achieve deeper cost cuts than planned.
"We are sorry to have worried our shareholders," he said.
At a board meeting following the shareholders' meeting, Watanabe was confirmed as vice chairman along with the other management changes.
Quick climb to the top
Toyoda had long been seen as a candidate to head the company founded by his grandfather in 1937 as he rose through the ranks at nearly twice the speed as his predecessor.
Toyoda and his new management team are scheduled to hold a news conference in Tokyo on Thursday.
Amid a global recession that has hammered car sales, Toyota's factories are severely underused. Making matters worse, Toyota builds about half of its vehicles in Japan, which works against it with the dollar squarely below 100 yen.
But unlike Chrysler and GM, which have closed plants, slashed jobs and shuttered dealerships in an effort to survive, Toyota has said it plans to ride out the downturn with its production capacity intact, arguing global vehicle demand will eventually recover.
"Erasing the losses is an urgent task but fundamentally, this company does things with a medium-term vision," said Tsuyoshi Mochimaru, an auto analyst at Barclays Capital.
"They're not going to suddenly change the way they do things to satisfy the short term. I expect the new management's strategy to be an extension of the previous one's," he said.
'Back to basics'
Shunning Western-style restructuring, Toyota has chosen to use the downtime to train workers. Already known as a lean operator, it is trying to squeeze costs further so it can be profitable using just 70 percent of its production capacity.
"A V-shaped recovery is actually not that difficult if you slash (capital expenditures) and jobs, for instance. Toyota could probably get a restructuring impact of close to 1 trillion yen. It's not that they can't do it -- they won't do it," Mochimaru said.
Toyoda has said he will steer the company "back to the basics" from a run of expansion in the past decade that Watanabe conceded may have been too fast.
Chairman Fujio Cho admitted in January that there was some hesitation about handing the baton to the relatively young Toyoda at such turbulent times, but said ultimately that a younger leader and the Toyoda name were the best hope for taking the "drastic measures" needed during the crisis.
But neither Cho nor Toyoda specified what those measures would entail, and analysts said they could be elusive anyway.
"A drastic reform at Toyota would involve cutting back its domestic production base," said Kurt Sanger, a Tokyo-based auto analyst at Deutsche Securities.
"But that probability is low. And with 50 percent of its production in Japan and the dollar at 95 yen, even if the U.S. market returns to 16 million units tomorrow, they'll still be making less profit than before."
Facing annual U.S. industry sales of around 10 million units, Toyota is expecting last year's operating loss, its first in seven decades, to balloon to 850 billion yen ($8.8 billion) in the year ending March 2010.
More competition
While analysts see Toyota's loss projection for this year as too cautious -- consensus forecasts put the loss at 495 billion yen -- they said returning to profit would be tough, and dependent on an economic recovery.
Even then, Toyota could face tougher competition as long as the yen stays relatively firm.
With most of its high-end Lexus cars produced in Japan, Toyota will either have to raise prices or accept lower margins. In contrast, a drop in the Korean won has made Hyundai Motor Co.'s cars more attractive and profitable.
The new, low-priced Prius hybrid launched last month has reversed the sales decline for that model, but risks eating into sales of its other, more profitable cars.
In contrast, analysts say Honda Motor Co.'s new low-cost Insight hybrid is relatively profitable, probably yielding higher margins than its Fit subcompact.
http://www.autonews.com/apps/pbcs.dl...73358134247728
06-25-09, 08:19 AM
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I just hope he doesn't kill the "Toyobaru coupe" or other enthusiast-friendly Toyota and Lexus models in the pipeline...
Toyota president says product lineup under review
By YURI KAGEYAMA, AP Business Writer
Akio Toyoda promised a nimbler Toyota that will be more responsive to regional needs in his first public appearance as head of the Japanese automaker his grandfather founded.
Toyoda, the automaker's first president from the founding family in 14 years, said Thursday the company's entire product lineup will be reviewed to better focus its offerings to each global region.
He also hinted Toyota was stepping back from its recent go-go years of global expansion and returning to basics and simply making good cars.
Toyoda, 53, one of youngest presidents in Toyota Motor Corp.'s history, also said he will put customers and the rank-and-file first to steer the world's biggest automaker out of its worst crisis since being founded in 1937.
"This ship is setting sail in a storm," he told reporters at a Tokyo showroom. "We are making our start from rock bottom."
The global auto slump has battered Toyota, which lost 436.94 billion yen ($4.4 billion) in the fiscal year ended March, its worst loss ever. Toyota is expecting more red ink this fiscal year.
But hopes have been high in Japan that the charisma of a Toyoda, long known as "the prince" in the Japanese media, will deliver a morale boost in the rank-and-file as well as among suppliers and dealers to steer the company toward recovery.
Toyoda, who received a master's degree in business administration at Babson College in the U.S. after graduating from Keio University in Tokyo, is the son of Shoichiro Toyoda, a former Toyota president.
He is also the great-grandson of Sakichi Toyoda, a visionary who founded a machinery maker, which later became an automaker under Kiichiro Toyoda, Akio's grandfather. (The company's name was changed slightly from the family name because "Toyota" was considered to have a luckier number of brush strokes.)
Toyoda's news conference was short on specifics. He said the company will focus aggressively on some auto model sectors, while dropping others that it couldn't hope to do well. But he declined to give details, saying the plans will be reviewed region by region.
Executive vice presidents will each oversee a global region — North America, Europe, Japan and emerging markets_ to respond to changing consumer needs, Toyoda said.
He stressed that hybrid technology — seen in the success of the third-generation Prius, which has sold briskly since going on sale last month — was an example of a Toyota strength.
Although officials said the company was keeping its global production capacity of 10 million vehicles, and not planning plant closures, Toyoda appeared to break somewhat from the expansion policies of his predecessor Katsuaki Watanabe.
Watanabe oversaw Toyota's strong growth since becoming president in 2005. Last year, the company surpassed U.S. automaker General Motors Corp. as the world's top automaker in annual vehicle sales.
Since the 1990s, Toyota has appeared almost unstoppable, boosting sales year by year, riding on its reputation for small cars with good mileage like the Camry and Corolla.
It appeared to be on track to hit global sales of 10 million vehicles until the global financial crisis sent sales plunging. Toyota is now expecting to sell 6.5 million vehicles in the year through March 2010.
Aiichiro Mizushima, who has written a book about Akio Toyoda's rise, said Toyota was no different from other global companies such as DuPont and Ford Motor Co. where founding family members have shown managerial leadership.
Toyoda checks things out firsthand, listens to colleagues and may be able to forge a new auto culture when the market is rapidly changing toward green cars, Mizushima said.
A board member since 2000, Akio is not an engineer like the Toyodas who came before him. But he has overseen China operations, Japan sales and Internet businesses, getting experience in various sectors, like any Toyota employee on a career track, reportedly because his father did not want to give him special treatment.
He also served as vice president at New United Motor Manufacturing Inc., a Fremont, California-based joint venture with GM, giving him key experience in the U.S.
"It will work as a plus that he personifies this powerful family," Mizushima said. "It may take time, but Toyota is certain to stage a recovery."
Toyoda alluded to the views of his great-grandfather, Sakichi Toyoda, who believed a company must make good products, create jobs, pay taxes and enrich the community. He acknowledged he was frustrated Toyota had not completely fulfilled those aims lately because of its recent losses.
"No matter who becomes president, this job is going to be tough," said Toyoda.
http://news.yahoo.com/s/ap/20090625/...s_japan_toyota
Toyota president says product lineup under review
By YURI KAGEYAMA, AP Business Writer
Akio Toyoda promised a nimbler Toyota that will be more responsive to regional needs in his first public appearance as head of the Japanese automaker his grandfather founded.
Toyoda, the automaker's first president from the founding family in 14 years, said Thursday the company's entire product lineup will be reviewed to better focus its offerings to each global region.
He also hinted Toyota was stepping back from its recent go-go years of global expansion and returning to basics and simply making good cars.
Toyoda, 53, one of youngest presidents in Toyota Motor Corp.'s history, also said he will put customers and the rank-and-file first to steer the world's biggest automaker out of its worst crisis since being founded in 1937.
"This ship is setting sail in a storm," he told reporters at a Tokyo showroom. "We are making our start from rock bottom."
The global auto slump has battered Toyota, which lost 436.94 billion yen ($4.4 billion) in the fiscal year ended March, its worst loss ever. Toyota is expecting more red ink this fiscal year.
But hopes have been high in Japan that the charisma of a Toyoda, long known as "the prince" in the Japanese media, will deliver a morale boost in the rank-and-file as well as among suppliers and dealers to steer the company toward recovery.
Toyoda, who received a master's degree in business administration at Babson College in the U.S. after graduating from Keio University in Tokyo, is the son of Shoichiro Toyoda, a former Toyota president.
He is also the great-grandson of Sakichi Toyoda, a visionary who founded a machinery maker, which later became an automaker under Kiichiro Toyoda, Akio's grandfather. (The company's name was changed slightly from the family name because "Toyota" was considered to have a luckier number of brush strokes.)
Toyoda's news conference was short on specifics. He said the company will focus aggressively on some auto model sectors, while dropping others that it couldn't hope to do well. But he declined to give details, saying the plans will be reviewed region by region.
Executive vice presidents will each oversee a global region — North America, Europe, Japan and emerging markets_ to respond to changing consumer needs, Toyoda said.
He stressed that hybrid technology — seen in the success of the third-generation Prius, which has sold briskly since going on sale last month — was an example of a Toyota strength.
Although officials said the company was keeping its global production capacity of 10 million vehicles, and not planning plant closures, Toyoda appeared to break somewhat from the expansion policies of his predecessor Katsuaki Watanabe.
Watanabe oversaw Toyota's strong growth since becoming president in 2005. Last year, the company surpassed U.S. automaker General Motors Corp. as the world's top automaker in annual vehicle sales.
Since the 1990s, Toyota has appeared almost unstoppable, boosting sales year by year, riding on its reputation for small cars with good mileage like the Camry and Corolla.
It appeared to be on track to hit global sales of 10 million vehicles until the global financial crisis sent sales plunging. Toyota is now expecting to sell 6.5 million vehicles in the year through March 2010.
Aiichiro Mizushima, who has written a book about Akio Toyoda's rise, said Toyota was no different from other global companies such as DuPont and Ford Motor Co. where founding family members have shown managerial leadership.
Toyoda checks things out firsthand, listens to colleagues and may be able to forge a new auto culture when the market is rapidly changing toward green cars, Mizushima said.
A board member since 2000, Akio is not an engineer like the Toyodas who came before him. But he has overseen China operations, Japan sales and Internet businesses, getting experience in various sectors, like any Toyota employee on a career track, reportedly because his father did not want to give him special treatment.
He also served as vice president at New United Motor Manufacturing Inc., a Fremont, California-based joint venture with GM, giving him key experience in the U.S.
"It will work as a plus that he personifies this powerful family," Mizushima said. "It may take time, but Toyota is certain to stage a recovery."
Toyoda alluded to the views of his great-grandfather, Sakichi Toyoda, who believed a company must make good products, create jobs, pay taxes and enrich the community. He acknowledged he was frustrated Toyota had not completely fulfilled those aims lately because of its recent losses.
"No matter who becomes president, this job is going to be tough," said Toyoda.
http://news.yahoo.com/s/ap/20090625/...s_japan_toyota
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