Toyota President Katsuaki Watanabe may be replaced next year by Akio Toyoda, grandson of the company's founder, after forecasting the first loss in 70 years, people familiar with the matter said.
Toyota President Katsuaki Watanabe may be replaced next year by Akio Toyoda, grandson of the company’s founder, after forecasting the first loss in 70 years, people familiar with the matter said.
Watanabe intends to take responsibility for Toyota’s operating loss forecast of $1.7 billion for the year ending in March, said one of the people, who asked not to be identified because a decision hasn’t been announced.
“Akio is the natural successor, a likelihood that’s been speculated for years, even before Watanabe made it to the top spot,” said John Shook, a University of Michigan management instructor and former Toyota manager.
Watanabe, 66, took his post in June 2005, positioning the Toyota City, Japan-based company to pass General Motors this year for the world sales crown. He also presided over the 13 percent sales slump through November in the U.S., where domestic automakers crippled by falling sales are being given government aid to avoid bankruptcy.
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Toyota stock has fallen 54 percent this year, while GM is down 88 percent.
Toyoda, 52, an executive vice president, serves on management boards for Toyota divisions including the unit that handles operations in the Americas. He is the grandson of founder Kiichiro Toyoda.
He joined Toyota in 1984, working in a variety of posts before being promoted to a senior management position in 2000. His father, Shoichiro, was the last Toyoda family member to lead the company, stepping down as president in 1992. Shoichiro Toyoda, 83, now is honorary chairman.
Mike Michels, vice president of communications for Toyota’s U.S. sales unit in Torrance, Calif., said talk of a senior-management change is “speculation right now” and “quite premature.”
Current global market conditions “could not have been anticipated,” Michels said. Watanabe “is leading a very vigorous charge to reduce costs” to combat sliding sales, he said.
The executive shift was reported Tuesday by Tokyo-based Asahi newspaper.
Toyota said Wednesday it cut global production 27 percent last month, the biggest in at least two decades. Output fell to 589,505 vehicles in November, led by a 55 percent drop in Europe, the company said in a statement. Japan production fell 27 percent to 288,138.
Watanabe originally was scheduled to unveil a revamped Prius hybrid next month at the Detroit Auto Show. He isn’t expected to attend the 2009 event, spokesman John Hanson said Wednesday.
As president, Watanabe oversaw an expansion of North American manufacturing capacity that included a $1.3 billion investment for a San Antonio plant that opened in November 2006 to help win a larger share of the full-size pickup market.
Sales of the Texas-built Tundra plummeted 28 percent through November, undercut by rising fuel prices. Toyota idled the factory for 15 weeks and this month said it would indefinitely halt work on a Prius plant in Mississippi.
Dwindling demand may test Toyota’s record of never shedding workers in 24 years of building cars in the country.