Toyota Motor Corporation (7203.T) has announced that Chief Executive Officer Koji Sato will step down after three years in the role. He will be replaced by current Chief Financial Officer Kenta Kon. The reshuffle, effective from an unannounced date, will see Sato become vice chairman and chief industry officer. Toyota is a global automotive manufacturer known for its commitment to quality and innovation. The company produces a wide range of vehicles, from fuel-efficient hybrids to commercial vehicles.
The leadership change coincides with increased scrutiny surrounding Toyota’s proposed buyout of forklift subsidiary Toyota Industries (6201.T). Minority investors have voiced concerns over the deal’s transparency and perceived undervaluation. The timing of the announcement, alongside the release of Toyota’s third-quarter earnings, was unexpected by many analysts. Toyota simultaneously boosted its full-year profit outlook by almost 12%, citing a weaker yen and successful cost-cutting measures.
In their new roles, Kon will focus on internal company management, while Sato will concentrate on broader industry matters. These changes are intended to accelerate decision-making, particularly in response to increasing competition from Chinese electric vehicle manufacturers. James Hong from Macquarie suggests the shift reflects Toyota’s awareness of the growing importance of non-automotive businesses, noting Kon’s extensive experience with the company’s financial operations. Kon has also been in charge of finances at mobility technology subsidiary, Woven by Toyota.
Sato assumed the CEO position from Akio Toyoda in April 2023, a period marked by pressure on Toyota’s approach to battery electric vehicles. Toyota’s shares saw a significant increase of 111% during Sato’s tenure, outpacing the Nikkei index. However, the company also experienced some market share losses to Chinese competitors in regions like Southeast Asia and faced governance criticism related to the Toyota Industries buyout.
