Toyota Names Experienced Auto Executive New President

, AP Business Writer

TOKYO February 9, 2005; Yuri Kageyama writing for the AP reported that Toyota Motor Corp., Japan's biggest automaker, named an executive with experience in production and corporate planning as its new president Wednesday and named a grandson of the company's founder to an executive post.

Katsuaki Watanabe, 62, who oversees procurement and business development, was named to replace Fujio Cho, 68, at the helm of the company, based in the central Japanese city of Toyoda.

Toyota also appointed as executive vice president Akio Toyoda, the son of former Toyota President Shoichiro Toyoda and the grandson of the company's founder, in a move that positions him as a top candidate for future Toyota president.

Cho, who became president in 1999, oversaw Toyota's growth not only in the key North American market but also in Europe and booming markets like China. He will be promoted to vice chairman, and Hiroshi Okuda will stay on as chairman, the automaker said in a statement.

Cho and Okuda are expected to continue to wield considerable influence over the direction of the automaker, and so the management changes aren't expected to result in major policy shifts. Cho will replace Okuda as chairman next year, the company said.

"Toyota is moving solidly on course following its plan for growth, and that's not affected by the changing of presidents," said Shinji Kitayama, auto analyst at Shinko Securities in Tokyo.

Kitayama said the promotion of a member of the Toyoda family had symbolic significance that could raise morale.

The continuing rise of Akio Toyoda, 48, who became board member in June 2000 and now serves as senior managing director, also symbolizes Toyota's shift toward younger management at a time when the long-entrenched rules of seniority are losing their grip on Japanese companies.

Toyoda has headed Toyota's Chinese operations as well as its Internet business. He also served as vice president at New United Motor Manufacturing Inc., a Fremont, Calif.-based joint venture between Toyota and General Motors Corp.

Okuda said the management shifts were meant to introduce change and promote younger managers at a time when Toyota needs to respond nimbly to regional needs. The average age of vice presidents will go down from nearly 64 to below 58.

"A company must change when things are going well. There's no point in trying to change after things start going bad," he told reporters at a Tokyo hotel.

Watanabe, who has supervised work in production control since the 1990s, said the biggest risk for Toyota is that it may grow arrogant and inflexible with size.

"I want to make the world's best car at the cheapest price and the fastest speed in the world," he said. "Everywhere I've worked, I've tried to build a good team."

Cho, a graduate of the Faculty of Law at the prestigious University of Tokyo, was key in preparing Toyota's plant in Kentucky. He worked there from 1987 until his return to Japan in 1994, when he was named managing director. Cho said he will spend the next year assisting Watanabe and preparing for his own chairmanship.

"I don't feel I've left anything undone," he said. "I did my best and now I'm handing over the helm to Mr. Watanabe."

Wednesday's appointments will become final after shareholders' approval in June.