jruhi4

They're, at the least, seriously considering it:

Toyota to revamp in U.S.
Operations under review as top market becomes loser
by Christine Tierney / The Detroit News

Toyota Motor Corp. is considering a major reorganization of its U.S. operations, bringing sales and manufacturing under one powerful executive, in an effort to keep closer tabs on its American business, which traditionally has been Toyota's biggest source of profit but is now losing money.

The Japanese automaker's top managers are expected to decide how to structure the U.S. operations this month, say people familiar with the situation. A decision would be formalized in June, at the same time that Toyota will anoint a new president in Japan, Akio Toyoda, the grandson of the company's founder.

The prospect that Toyota may install an executive in the United States with over-arching powers appears likely now that the management in Japan has taken the unusual step of rehiring a former top executive with U.S. experience. Yoshimi Inaba, who retired abruptly in 2007, is returning to take a position with Toyota in the United States.

Toyota officials would not comment on possible changes in the North American operations because discussions are ongoing.

Toyota's main North American operations -- its sales subsidiary based in Torrance, Calif., and its manufacturing arm in Erlanger, Ky., now report to sales and manufacturing managers in Japan.

Toyota was prompted to consider a far-reaching reorganization by the collapse of the U.S. auto market that led to the first losses in nearly 60 years at Japan's -- and now the world's -- largest automaker, according to people familiar with the situation.

Traditionally, Toyota has generated half or more of its profit in the United States. "Toyota in the U.S. has known nothing but success," said Daniel Gorrell, president of AutoStratagem in Tustin, Calif.

The move to rehire Inaba suggests that top managers are prepared to take exceptional measures to reinforce the ranks at a tricky time for the company.

The new CEO, a member of the founding Toyoda family, will be surrounded by seasoned advisers, but he has not been tested the way a career executive would have been, financial analysts say. A Tokyo-based analyst, who spoke on condition of anonymity, said the ascent of a family member had provoked "a quiet unease" among investors.

While all automakers are struggling in this environment, Toyota's share price has fallen slightly more than stock in its closest competitor, Honda Motor Co.

Japan's second-largest automaker, Honda has expanded more cautiously than Toyota, and resisted pressure to build more large engines and vehicles, settling for a quirky, car-based pickup, the Ridgeline, at the top of its U.S. model range.

By contrast, Toyota's ill-timed assault on the U.S. full-size pickup segment, including the construction of a plant in Texas dedicated to building trucks only, has been very costly. The plant was idled for three months last year. This year, Tundra pickup sales are running about 40 percent of the levels originally forecast.

Its disappointing launch strained relations between U.S.-based managers and executives in Toyota City who were reluctant to make such a big pickup.

People familiar with the situation say managers in Japan feel the U.S.-based executives were overly optimistic in their sales forecasts. On the other hand, U.S.-based managers and dealers complained that some bosses in Toyota City were equipping vehicles too richly for the U.S. market, making them too expensive.

Quibbling turned to finger-pointing as Toyota's results deteriorated dramatically. The company has forecast a $3.5 billion loss for the fiscal year ended on March 31 -- a stunning $20 billion swing from the previous year's record result.

"Clearly there needs to be close coordination between sales and manufacturing, especially today when the market's moving so fast," said George Peterson, president of consultancy AutoPacific Inc. "You've gone from being able to sell every Prius you could build last summer to not being able to give them away."

By installing someone like Inaba, who knows the U.S. market and speaks perfect English, Toyota executives expect to get a better reading of this key region.

To be fair, says CSM Worldwide Vice President Michael Robinet, "the rapidity of the decline caught everyone by surprise."

Although Toyota has tried to reduce its reliance on the U.S. market in recent years, "North America is still a very important market. Assigning Inaba there speaks volumes about his experience and his knowledge," said Alberto Lapuz, Tokyo-based vice president of J.D. Power and Associates' Asia Pacific branch.

Irv Miller, a spokesman for Toyota's U.S. sales subsidiary in Torrance, said he could not say what Inaba would do.

"What his role and function will be has yet to be determined," he said. "I know there will be a management change, but I have no idea how the organization will be structured at this point in time."

One option for Inaba: heading the automaker's holding company in New York City, Toyota Motor North America. That job traditionally has been ceremonial -- which is why Jim Press left it two years ago to join Chrysler LLC. But it could be turned into a powerful position.





http://www.detnews.com/article/20090...384/1148/rss25

Allen K

iTrader: (4)

Sure hope they saved some of that record profit.

Cabinetman

What Toyota needs to do is get away from their regional distributors. Here in Texas we get our cars from Gulf States and they always have a large number of distributor add-ons.

IS-SV

Yeah, how's their Balance Sheet?

jruhi4

Here's a follow-up article of sorts:

Toyota's New Management Lineup Takes Shape
by Ian Rowley - BusinessWeek

With the start of Akio Toyoda’s presidency a little over two months away, Toyota today announced its new management lineup. It includes the return of Yoshimi Inaba, who is expected to oversee the company’s troubled North American business after the changes are approved in June.

Inaba, a former head of Toyota Motor Sales USA, was most recently in charge of the company’s Chinese operations, but in 2007 surprisingly left to become CEO of Central Japan International Airport. Toyota has a stake in the airport operator and often sends execs to group companies, but rarely asks them to come back. One analyst suggests Inaba, a fluent English speaker seemingly at ease on most topics, may have been a little too candid for some of Toyota’s top brass—hence his time away. Still, with Toyota’s U.S. sales plunging, it seems wise to bring him back now. (The company confirms Inaba will be involved in the company’s North American operations but declines to confirm he will oversee both the U.S. sales and production divisions, as has been widely rumored.)

Inaba isn’t the only returnee. Masamoto Maekawa, currently president of Toyota Administa, and Yasumori Ihara, chief of Toyota Transportation Co. are welcomed back to the mother ship after several years away. Perhaps a sign that Toyota isn’t producing enough top level managers from within, Inaba, Maekawa and Ihara all join Toyota’s board.

It’s also noteworthy which execs are retiring. Among them the 14 managing officers and five directors that are stepping down, two names stand out: former Presidents Hiroshi Okuda, 76, and Shoichiro Toyoda, 84. Senior adviser Okuda became Toyota president in 1995 and, as well as paving the way for Toyota’s rapid expansion over the last decade, had the foresight to back research into the Toyota Prius hybrid. Toyoda, meanwhile, has spent 57 years at the company his father founded and headed Toyota between 1982 and 1992. Presumably with his son Akio, 52, poised to take over from current chief Katsuaki Watanabe, he feels his work his done.

http://www.businessweek.com/autos/au...s_new_lin.html

I8ABMR

WOW I wasnt aware of the new plant the built in Texas for truck production. BIG mistake

pagemaster

If I am not mistaken. Toyota North American operations has capacity for up to 50% of their vehicles dedicated to SUVs/trucks. Plans to build Highlander and 4runner in the USA were underway. I know Toyota moved some Prius capacity to usa in the future. Toyota needs to get away from so many SUV and trucks.

-J-P-L-

The truck and SUV plants took shape before the huge gas hike last year and well before the global financial crisis. Toyota has great foresight but even they can't see everything coming in this ever changing world.

At least Toyota maintained a balance in their lineup that included more small vehicles than any other automaker.

pagemaster

I disagree with you.

Rav4
RX350
Sequioa
Tundra (400,000 capacity)
Tacoma

upcoming Highlander

are all built in North America

Toyota builds

Corolla/Matrix
Camry/Solara
Avalon/Venza
Sienna

are all build in North America


Toyota is losing money with the Tundra plant and the SUVS sitting on the lot.

mmarshall

That was announced some time ago. Toyota chose TX for its latest truck plant for two reasons. First, the obvious one, with cleaper labor than up north and TX being a buisness-friendly state. Two, pickup trucks are a long-standing institution in TX, so, even though F-150s and Silverados are the two predominating trucks, Toyota figured the local population would not be too adverse to their trucks coming in, where they could be easily compared with the domestics.

pagemaster

Don't forget the Tundra was built in Indiana from 1999 to early 2008. Toyota built way too much capacity with the current Tundra. This was Jim Press's doing...

mmarshall

The previous-generation Tundras were not competitive....they simply weren't big enough for the American full-size truck market. Though it took Toyota over a dozen years (from 1994 to 2006) to get their (too-small) American-market large trucks right, they have FINALLY done so, though, due to cost-cutting, some flimsy materials are used in the trim, sheet metal, and hardware.

Nissan did it right the first time, with the Titan, size-wise, but it has been plagued with quality problems until very recently.

pagemaster

sorry mmarshall. You are wrong. The first gen Tundra was competitive. Even though it did not match the domestics in size and towing...(this was intentional, Toyota matched the domestics in size with the 1st gen Sequioa but mechanicals where not as strong) it was competitive for payload, price, durability and offered American buyers something different than GMC/Ford/Dodge.

From a sales level. The first generation Tundra was a huge success for Toyota. The first gen Tundra had sales growth year over year (125,000 units in its best year) and introduced the Sequioa sized double cab model.

At the time of the Tundra introduction in 1999.. Toyota had nowhere near the capacity to design, engineer and build a truck the size of the domestics. Early Tundras/Sequoia (1999-early 2004) used Japanese engines, tranmission and rear ends. This was intentional as America would not of embraced a American sized Tundra.

The current Tundra is designed, sourced and built in the USA. First gen was designed, partly sourced in Japan but assembled in USA.

Payload, comfort, price, interior was very competitive to the domestics. The powertrain was behind.

lexusscturbo

iTrader: (12)

I knew this was coming...Yet many companies view Toyota as a God from a mfg. stand point. As they had the 6 Sigma and "Lean Engineering" concepts down..I guess if Toyota tumbles so will their students *grasps* on

pagemaster

Toyota was very good at one time from a manufacturing, design and sales standpoint. Toyota starting slipping when they got focused on trying to be the number one manfuacturer worldwide. This is a focus on SALES and not PROFITS

Toyota is bleeding money with the Tundra/Sequoia disaster. The Lexus sedans are overpriced for the market/design, Venza is a dud..and too many suvs/trucks are built in north america and not enough cars.

Toyota has gotten away from what made them so popular in making vehicles that are reasonably priced, performs well and are reliable.