Most of the companys history has been characterized by relentless progress and expansion, but now Toyota is slashing production, cutting jobs and reeling from tumbling sales amid a global financial crisis. The company says it will post an operating loss for the fiscal year ending March 31.
North America accounts for a third of Toyotas worldwide revenue and US sales fell 15.4 percent to 2,217,660 vehicles last year. Toyotas sales in Europe were down 12.4 percent to 814,581 in Europe for the same period and global sales dropped 4 percent to 8.97 million units in 2008. That figure marks Toyotas first sales decline in 10 years.
We are now faced with unprecedented difficulties that come along only once in 100 years, Toyoda told reporters. I need to focus on the rapidly changing environment.
Toyodas international portfolio includes stints heading Toyotas China and Asian operations and serving as a vice president at its General Motors joint venture in California.
Last summer he was put in charge of all overseas business.
He is deeply grounded in US business practices, customs, and finances.
Like Edsel Ford II, Akio Toyoda graduated from Babson College in the US state of Massachusetts, a school that specializes in educating the children of business leaders. After graduating in 1983, he worked at a New York investment bank.
A top priority for Akio Toyoda will be rethinking the companys overseas business, analysts say. His team will have to consider shifting more production offshore to replace domestic output as it battles a soaring yen and rising raw-material costs.
Toyota is the strongest manufacturer in the world, but it is strategically weak because it has not embedded itself in the richest market in the world, the US, says Michael Wynn-Williams, an analyst at IHS Global Insight. He sees more production shifting overseas as quickly as possible.
Watanabe is chairing an emergency profit committee charged with trimming fat. But aside from production and job cuts, there has been little to show in the way of broad overhauls.
Honda Motor, by contrast, held a year-end news conference last month to outline a litany of drastic measures meant to keep the company in the black. They included canceling President Takeo Fukuis beloved Formula One program and deciding not to replace the NSX sports car.
Toyoda may come under pressure to make similar sacrifices.
He is known for pushing through unpopular decisions.
Long before e-commerce was a buzzword, Akio Toyoda pioneered Toyotas online business initiatives -- against stiff opposition from the executive floor.
He began by trying to apply Toyotas fabled production system to dealerships. Toyota could build a car in less than a day, but dealers took another 40 days to deliver it to a customer and get paid. Akio wanted to cut that time by more than 10 days to improve dealers cash flow.
Denied a budget for his ideas, Akio used his own money to start Gazoo.com. It soon blossomed into an online referral service, offering basic information to shoppers about car features, sticker prices and finance plans. Yet, the real success rested on its evolution into an online shopping mall where people can by everything from music CDs to bean paste.
By building relationships with consumers making everyday purchases, Toyota hopes those individuals will return to Gazoo when they want to buy a car. Gazoo can then direct them to a Toyota dealer.
Akio Toyoda will be the first Toyoda to become president since 1995, when his uncle Tatsuro Toyoda stepped down. The Toyoda family owns only 2 percent of the companys stock but benefits from hard-to-measure additional influence that the Japanese call plus-alpha.
At the press conference, Toyoda called his father, the companys honorary chairman, a flag around which the company has traditionally rallied.
I am not yet that flag, but I intend to do my best so that maybe 20 or 30 years from now, people may look back and refer to me as a flag, he said.
The difference in the names of the family and company is due to the latter exchanging the d for a t because that was considered luckier in Japanese numerology.
During Tatsuro Toyodas tenure as president, Toyotas share of the Japanese market shrank and the company drifted. After suffering a stroke in 1995, he was followed by three non-family presidents -- an era that was seen as a check on nepotism in a publicly traded company.
While few doubt Toyodas talent, many suggest he is still too young. Some expected Toyota would appoint an older, caretaker president to give the relatively youthful scion time for more on-the-job training.
Toyodas appointment must still be approved at a June board meeting, and Watanabe will then become vice chairman. But the risks of the reshuffle arent lost on the home audience.
Ahead of the companys official announcement, Japans Yomiuri newspaper pondered Akios new role, saying: Toyota gambles on founding familys prestige.