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Honda’s ongoing air bag problem has claimed another victim. In this case, it’s President and CEO Takanobu Ito, who will step aside at the end of the automaker’s fiscal year in April.
Honda has recalled millions of vehicles worldwide to replace faulty air bags produced by embattled supplier Takata – an issue now linked to at least five fatalities. But the Japanese automaker has run into a number of other issues, earlier this month scaling back its earnings forecast for the rest of the year.
Ito will be replaced by Honda Managing Officer Takahiro Hachigo. During a 33-year career, Hachigo helped guide the maker’s business ventures in China, Europe and the U.S. Among other things, he led the development of the popular Honda Odyssey minivan built in one of the maker’s many American assembly plants.
The air bag recalls have been costly for Honda. On a financial front, they led to a 15 percent plunge in earnings for the October to December quarter, to $1.2 billion. Honda forecasts full-year earnings will fall 5 percent. But the crisis has also tarnished the reputation of a company traditionally hailed for producing safe, high-quality products. Honda is still forecasting sales for the current fiscal year will climb to 4.45 million, up from 4.3 million during the prior year.
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-- Paul A. Eisenstein