Akio Toyoda, president of Toyota, is the grandson of its founder.
The results have yet to show, and in fact, no one at Toyota expects 2009 to be anything but dismal. (On Tuesday, the company reported a loss of $819 million for the first quarter.)
Its new president, Akio Toyoda, has moved quickly since taking charge in June, when he declared his dismay at the company’s financial crisis.
“Like everyone in the company, I am extremely frustrated” about the automaker’s decline, Mr. Toyoda said at his first news conference as president. “So we must start again from the ground up.”
His first target was Toyota’s top management. Already, 40 percent has retired or been reassigned.
Four of Toyota’s five executive vice presidents, the group that now leads the company under Mr. Toyoda, are new to their jobs. Only one, Takeshi Uchiyamada, Toyota’s product development chief, is a holdover from the team that surrounded Mr. Toyoda’s predecessor, Katsuaki Watanabe.
Further, the four newcomers are each in charge of a global region on top of duties within the company. (Mr. Uchiyamada is the only one with a single focus.)
Now Mr. Toyoda is headed for the United States. On Wednesday, he will address a management seminar sponsored by the Center for Automotive Research, near Traverse City, Mich., an annual gathering of the clan in the auto industry.
Toyota dealers and employees, many of whom know Mr. Toyoda from the years he worked in the United States, are eager for a shot of adrenalin from their new boss, the grandson of Toyota’s founder.
“He knows the business,” said P. Compton Cramer Jr., the owner of Cramer Toyota of Venice, Fla., who first met Mr. Toyoda a decade ago.
“He’s going to bring a new kind of energy to the company,” added Josephine Cooper, Toyota’s group vice president of government and industry affairs, who had been Mr. Toyoda’s hostess in Washington before his promotion.
Mr. Toyoda’s biggest problem, executives and analysts say, is transforming a lineup dotted with mundane-looking vehicles that buyers bought because of their reliability, not because of their style appeal.
It is a problem shared with Detroit, where executives are striving to inject their automobiles with excitement, too. Unlike G.M., Ford and Chrysler, however, Toyota cannot reach back to its roots and tap into a DNA of sexy sheet metal.
And it faces a difficult balancing act: become too aggressive, and Toyota risks chasing off the practical-minded consumers who have been its base for a half-century. Some have already been scared off.
Pamela Templeton, an owner of Fort Myers Toyota in Florida, said Toyota was caught “a little flat-footed” when gas prices hit record levels last year. Despite a longtime focus on small cars, the company bet heavily this decade on trucks like the Tundra and sport utility vehicles like the FJ Cruiser.
So did Ms. Templeton, who spent $13 million to open a separate 165,000-square-foot showroom just for light trucks. The market’s demise forced her to eliminate customer pampering like a massage chair and cappuccino machine. “We had to make hard choices, and I’d rather keep people than fluff,” she said.
Only two years ago, Toyota was riding the crest of a deliberate growth strategy in which it doubled in size and became the world’s biggest car company. Although most carmakers have suffered, Toyota’s rapid decline shocked many at the automaker and the experts who follow it.
Yoshimi Inaba, named by Mr. Toyoda as Toyota’s new head of North American operations, faces heavy pressure to turn things around here. “Without North America, we are not likely to come back to global proficiency,” Mr. Inaba told reporters in Detroit last month.
Toyota has an advantage over its Detroit rivals in its streamlined processes for engineering and building its cars, said James P. Womack, an author and expert on company efficiency. But he said the company, famous for caution and self-reflection, strayed when growth, not quality, became its main concern.
“They sort of quit being paranoid,” Mr. Womack said. “I’m neutral to buy on Toyota over the long term. It’s going to take them a while to get back on their feet.”
Ms. Cooper faces a unique concern in Washington, where the Obama administration spent $65 billion this year to shepherd G.M. and Chrysler through bankruptcy and to pay for their restructurings.
She said she was constantly being asked how her company, which spent years trying to emphasize its investments in the United States, viewed the White House support for its rivals.
“My job is to make sure there is not more attention paid to Toyota because of this,” Ms. Cooper said.
But Toyota cannot avoid scrutiny as it decides what to do with its half of New United Motor Manufacturing Inc., or Nummi, a 25-year-old joint venture with G.M. in Fremont, Calif.
G.M. has pulled out of the deal and classified the plant as one of the assets of the old G.M., which are being liquidated in bankruptcy.
Toyota said last week that it might dissolve its half of the venture, which was the brainchild of Mr. Toyoda’s father, Shoichiro Toyoda, and paved the company’s way into the American car market in 1984.
That has set up a confrontation with the United Automobile Workers union, which represents workers at the plant. Sergio Santos, the local union president, argues that the plant’s experienced work force is among the country’s best, consistently ranking ahead of other Toyota factories on productivity surveys.
“We have Super Bowl trophies to back up what we do,” Mr. Santos said.
Union leaders are pressing lawmakers in California to provide incentives so Toyota can keep the plant open, while U.A.W. leaders have urged members to lobby Congress for worker protections.
Even if the venture dissolves, Mr. Santos said he hoped the plant could be sold back to Toyota or another new owner like Roger Penske, the former racecar driver and entrepreneur who recently purchased Saturn.
Senior executives in Japan will make the final decision on Nummi, Ms. Cooper said.
Closing the plant would be a turning point for Toyota, representing both the end of its first chapter in the United States and an acknowledgment of its harsh financial reality, Mr. Womack said.
He said the downturn had presented Toyota with the chance to stop emulating Detroit and to detour to a more realistic path.
Ms. Templeton, the Florida dealer, agreed. “Instead of trying to be the manufacturer for everyone, they need to get back to being the best,” she said.
Mary M. Chapman contributed reporting.By MICHELINE MAYNARD
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