Honda replaces president as it strives for turnaround

Honda Motor Co. named Takanobu Ito, an expert in auto development with experience in the U.S., as its new president Monday in an apparent effort to aim for a turnaround under fresh, younger leadership.

Ito, 55, senior managing director overseeing auto operations, will replace Takeo Fukui.

The move follows a similar change at the top at Toyota Motor Corp., which recently named Akio Toyoda, a member of the founding family, to replace Katsuaki Watanabe.

The change at Honda, part of a minor reshuffling of its board, still needs shareholders' approval at a meeting in June.

"I decided to hand control over to Ito because in such a severe time, Honda should be united under new and younger leadership to surmount its challenges," Fukui told a news conference.

Asked whether he hesitated to step down amid the harsh business environment, Fukui admitted he did, adding: "I thought it would be rather good, considering the expected rebound after we get over this."

There had been speculation that Fukui, 64, who has already served six years as president, would step down. But the timing was uncertain as Honda, like other automakers, are battling a serious downturn in global demand.

Through Ito's appointment, Honda appears to be sending a message of its determination to turn over a new leaf and press ahead with technological innovations — its longtime strength — in battling the global slump and aiming for a turnaround.

Ito said he would continue in Fukui's footsteps in developing ecological and affordable products such as the hit Insight hybrid.

"Honda's strength has been its sensitivity to changing times and responding quickly to customer needs," he told reporters at Honda's headquarters. "My job is to come up with products that can pave the way for new times."

"What is needed now is to release (new) products speedily and flexibly," Ito said.

Fukui will become an adviser and remain on the board.

Ito had already been scheduled to head the research and development unit of Honda in April. With the latest decision, if approved, he will also head Honda overall.

Honda has fared relatively better than Toyota in riding out the downturn, partly because Honda doesn't make large trucks and tends to be more nimble.

But even Honda is also hurting and has been curbing production and reducing workers at its plants.

Honda, which saw its October-December profit plunge 90 percent, is expecting ¥80 billion in profit for the fiscal year ending March 31. Earlier, it had projected a ¥185 billion profit.

The strong yen, which erodes the earnings of exporters, has hit the profits of Japanese automakers hard, including Honda.

Fukui, who built his earlier career developing motorcycles, led Honda's global expansion, including in the critical U.S. market. He also led Honda's foray into the small jet business and recently brought out the Insight hybrid.

After joining Honda in 1978, Ito began his career as an engineer designing chassis. He was in charge of developing the frame for the NSX sports car, which went on sale in 1990.

From 1998 to 2000, he served as executive vice president at Honda R&D Americas Inc., where he helped develop the first sport utility vehicle under the Acura brand, Honda's luxury models. The MDX went on sale in the U.S. in 2000, according to Honda.