January 20, 2009 / 7:07 AM / 9 years ago

NEWSMAKER-Founder's grandson Toyoda takes the wheel at Toyota

TOKYO, Jan 20 (Reuters) - Tracing Akio Toyoda’s 24-year career at Toyota Motor Corp (7203.T) back to its genesis is to witness a carefully drafted roadmap for a climb to the top.

His appointment as president of his grandfather’s company comes at a time of crisis, with the world’s top car maker caught in the same downdraft from the global credit crunch that has sent car sales plunging globally and rivals queuing up for bail-outs.

Ambitious and studious, Toyoda has overseen a full range of automotive operations at the company founded in 1937 by his grandfather, Kiichiro, and run by his father, Shoichiro, for a decade in the 1980s.

Ranging from manufacturing to marketing to product development and much more, Akio’s roles have come to be seen as a test as to whether he was fit to steer the ship that many believed always belonged to the Toyoda clan, although it now holds just 2 percent of a the $115 billion company.

While few voice any doubt that the 52-year-old has proven his worth over the years to lead what has become the world’s biggest automaker, it wasn’t always smooth sailing.

Having joined Toyota mid-career after a brief stint overseas consulting in investment banking, Akio was in the minority among first-year workers, most of whom joined straight out of university.

Some dismissed Akio as a family scion for whom Toyota’s doors were wide open regardless of merit.

But any remaining doubt about a lofty future for Akio, who earned a master’s degree from Babson College in the United States, vanished when he joined the board of directors in 2000 after a relatively short 16 years at the company.

Those who know him say he is outspoken in board meetings -- a winning trait for a strong leader.

Having successfully spearheaded the gazoo.com sales and servicing website and led Toyota’s nascent Chinese operations, he quickly rose through the ranks to become senior managing director three years later and became one of eight executive vice presidents in 2005.

Katsuaki Watanabe, whom he will replace as president in June, took almost twice as long to occupy each of those posts. Akio will be the first Toyoda at the helm since 1995, when his uncle, Tatsuro, stepped down due to illness.

The name of the company was chosen because when written in Japanese alphabet, Toyota is eight strokes and Toyoda is 10, and eight is an auspicious number.


Company elders, including senior adviser and former president Hiroshi Okuda, have never pretended that Akio’s speedy climb was unrelated to his family name.

When Akio’s promotion to the vice presidency raised the question of whether he was next in line for the top post, Okuda answered point-blank that the Toyoda family played an important role as a flag-bearer and binding force for the carmaker.

Akio is keenly aware of the weight of that responsibility -- simultaneously a blessing and a curse.

Whatever scrutiny his three predecessors, Watanabe, Fujio Cho and Okuda, faced from the Toyoda family, that would be magnified for Akio from the rest of the company -- and shareholders -- as he is tasked with nursing Toyota back from its first annual loss in more than half a century.

While former presidents such as Eiji Toyoda and Shoichiro Toyoda command God-like respect from employees, Akio will be allowed few missteps as long as there are sceptics who believe the family’s small holding in the company does not merit a career advantage for those who bear its name.

    That scrutiny has arguably multiplied after some local media reported the rift between top management and Toyoda family elders over the latest succession plan, announced on Tuesday. [ID:nT339558]

    Akio’s father, Shoichiro, serves as honorary chairman while Okuda remains as senior adviser.

    Some long-time employees in Japan, where many children are taught the history of the Toyoda family in school, have high hopes that the return of a member of the founding clan would raise morale and steer the company in the right direction.

    But unlike Henry Ford, or even Honda Motor (7267.T) founder Soichiro Honda, Kiichiro Toyoda does not enjoy iconic status and is little known outside Japan.

    In an era where only about 70,000 of Toyota’s 300,000-strong work force are Japanese, it remains to be seen how effective the Toyoda name will be.

    One U.S.-based employee, who joined Toyota more than 25 years ago, believes otherwise.

    “From my perspective it really doesn’t make a difference,” Jim Lentz, president of Toyota’s U.S. sales unit, told Reuters last week.

    ”This is a company that’s not driven by the personality of one leader. This is a consensus-driven company.

    “I think whether it’s Akio or anyone else, this industry has changed. The world has changed. So whoever the next leader is, we’re going to have to analyse and look at all of our systems and processes to deal in a world that’s going to be much more volatile than the stability we’ve seen in the last 15 years.” (Editing by Lincoln Feast)

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