In a move aimed at addressing the fallout from a safety-testing scandal, Toyota Motor Corp revealed on Tuesday that both the president and chairman of its subsidiary Daihatsu Motor will step down. This significant shake-up comes almost a year after Daihatsu admitted to rigging collision safety-tests, prompting Toyota to take swift action to restore the brand’s reputation.
The departures of Daihatsu’s president and chairman mark one of the most drastic changes implemented by the company as it strives to realign the small-car unit with its legacy as one of Japan’s most renowned compact car manufacturers.
Toyota, the world’s top-selling automaker, faces potential damage to its reputation from the safety certification lapses at Daihatsu, as well as governance issues at truck maker Hino Motors and affiliate Toyota Industries. These scandals have led to a rare apology from Toyota Chairman Akio Toyoda last month.
In a statement, Toyota announced that Masahiro Inoue, currently the chief executive officer for the Latin America and Caribbean region, will assume the role of Daihatsu’s president effective March 1, replacing Soichiro Okudaira. Additionally, Daihatsu’s chairman, Sunao Matsubayashi, will step down without a replacement being named.
Despite the leadership changes, Toyota’s Chief Executive Koji Sato emphasized to reporters that the reorganization at Daihatsu was not punitive in nature towards the outgoing executives.
Daihatsu, which accounted for 7% of Toyota’s total group sales of 11.2 million vehicles in 2023, will also be removed from the Commercial Japan Partnership Technologies (CJPT), a commercial vehicle partnership established in April 2021 by Toyota, Hino, and Isuzu Motors. Suzuki Motor and Daihatsu joined the partnership later in the same year.
As part of the restructuring, Daihatsu’s 10% equity stake in the partnership will be transferred to Toyota, signaling a strategic realignment of priorities within the group.
The leadership changes and restructuring efforts underscore Toyota’s commitment to upholding the highest standards of integrity and accountability across its operations. By swiftly addressing the issues at Daihatsu and taking decisive action, Toyota aims to restore trust among consumers and stakeholders while reaffirming its commitment to quality and safety in the automotive industry.
