Toyota Motor Corp. has announced the appointment of Kenta Kon as its new chief executive officer, marking an unexpected change in leadership during a pivotal moment in the company's efforts to privatize a key unit.
Currently serving as Toyota Motor's chief financial officer, Kenta is set to take on the CEO role starting April 1, according to the company.
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He will be succeeding Koji Sato, who was named CEO in 2023 and will transition to the position of vice chairman while also assuming the newly created position of chief industry officer.
The decision to elevate the finance chief to CEO was driven by Toyota's urgent requirement to enhance profitability, the company stated.
Meanwhile, Sato will leverage his position as the head of the Japan Automobile Manufacturers' Association to guide the overall industry towards success.
The company stated that the shift in roles is aimed at expediting managerial decision-making in light of evolving internal and external circumstances.
Toyota has carefully assessed the most effective leadership arrangement based on current environmental factors and the unique capabilities of each executive. The reorganization is happening at the same time as a significant transaction for the Toyota group, as they aim to privatize Toyota Industries Corp. through a tender offer set to conclude next week.
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This move is being met with resistance from activist investor Elliott Investment Management, who believes the offer does not accurately reflect the company's value, turning the proposed buyout into a challenge for Japan's corporate governance reforms.
Kenta currently serves as a director at Toyota Fudosan Co., a company at the forefront of the acquisition.
Akio Toyoda will maintain his role as chairman at both Toyota Fudosan and Toyota Motor.
The announcement of the CEO aligns with Toyota Motor revising its annual profit forecast upwards following exceptional sales that offset the negative impacts of US tariffs on imported vehicles and car parts.
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The largest car manufacturer in the world now anticipates an operating profit of 3.8 trillion yen ($24 billion) for the fiscal year ending in March 2026. This represents an increase from the initial projection of 3.4 trillion yen and falls just short of the anticipated 3.9 trillion yen by analysts.