Honda Motor Co. named Takanobu Ito, an expert in auto development with experience in the U.S., as its new president and chief executive Monday, in an apparent effort to spur a turnaround under fresh, younger leadership.
Ito, 55, senior managing director overseeing auto operations, replaces Takeo Fukui, Japan's No. 2 automaker said in a statement.
The move comes as Honda and all Japanese automakers grapple with a slump in global demand for cars. Through Ito's appointment, Honda appears to be sending a message of its determination to turn a new leaf and press ahead with technological innovations — its longtime strength — and aim for a turnaround.
The move, part of a reshuffling of its board, follows a similar change at the top at bigger rival Toyota Motor Corp., who recently named Akio Toyoda, a member of the founding family, replacing Katsuaki Watanabe.
The change at Honda, which makes the Insight hybrid and Accord sedan, still needs shareholders' approval at a meeting in June.
Fukui and Ito were scheduled to give a news conference later in the day at Honda's Tokyo headquarters.
There had been some speculation that Fukui, 64, who has already served six years as president, may step down, but the timing was uncertain. 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, but now he will oversee the entire company.
Faring better than Toyota
Honda, has fared relatively better than Toyota, the world's biggest automaker, 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, whose October-December profit plunged 90 percent, is expecting 80 billion yen ($856 million) in profit for the fiscal year ending March 31. Earlier, it had projected a 185 billion yen profit.
The strong yen, which erodes the earnings of exporters, has also cutting profits at Japanese automakers, including Honda.
During his tenure, 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 bought the hit Insight hybrid to market.
After joining Honda in 1978, Ito began his career as an engineer designing chassis, the main part of an auto, and was in charge of developing the frame structure for the NSX sports car, which went on sale in 1990.
From 1998 to 2000, Ito 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.