Koji Sato to take over as new Toyota CEO

Toyota has announced a change at the top of the group. Koji Sato, previously president of the Lexus brand and the motorsport subsidiary Gazoo Racing, will become Toyota’s new president and CEO on 1 April 2023, replacing Akio Toyoda in this role.

The grandson of group founder Kiichiro Toyoda will take over as chairman of the board of directors. What impact the change in leadership will have on Toyota’s current multi-drive strategy remains to be seen. Toyota is currently revising its EV strategy and will present a new three-year plan to its suppliers early this year.

The change of leadership coincides with the new fiscal year in Japan, which traditionally starts on 1 April and ends on 31 March of the following year. The current chairman of the board of directors, Takeshi Uchiyamada, will then step down as chairman but will remain a member of the board and deputy director of the company.

Toyota does not give any background information in the short and emphatically factual announcement, partly in tabular form. However, the news agency Reuters is transparent in its article directly in the first paragraph: “Toyota’s chief executive will step down as head of the company his grandfather founded, the automaker said on Thursday, handing over to the leader of its Lexus luxury brand as the Japanese giant struggles to meet the shift to electric vehicles.”

Toyota itself posted a broadcast alongside the announcement on its own YouTube channel, which is more like a talk show in style. In it, the 66-year-old Toyoda said it was now Sato’s job to transform Toyota into a “mobility company”, but without giving details. Incoming CEO Sato also took part in the talk and gave unusual insights into the process for a major Asian corporation. During a trip to Thailand at the end of 2022, Toyoda asked him, as a complete surprise, if he could take over the CEO position. Sato said he initially thought it was a joke.

Even for analysts in Japan, the announcement’s timing came as a surprise, as did the nature of the leadership change. Reuters quotes an analyst who suspects that Toyoda, as chairman of the board of directors, will continue to be heavily involved in the operational business, so for Sato, this will be “a kind of apprenticeship”.

It was not only Toyoda’s unresolved succession that had recently caused disgruntlement among investors. Toyoda’s strategy of focusing for a long time on hybrid cars and fuel cell vehicles instead of battery-electric drives has also come under increasing criticism given global market developments.



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