Honda looks to new chief to emerge from crisis-filled era

Managing officer Hachigo takes over at auto giant

Honda Motor Co’s chief executive officer will step aside later this year as Japan’s third-largest carmaker reels from one of the biggest setbacks over quality in its history.

In a surprise announcement on Monday in Tokyo, 61-yearold Takanobu Ito said he will hand over the reins to Managing Officer Takahiro Hachigo, 55, after the annual shareholders’ meeting in late June. Ito, the motorcycle-racing engineer who’s led Honda since 2009, said he handpicked Hachigo for his experiences running Honda’s various overseas businesses.

The CEO is ceding his job after leading the company through a tumultuous era that began with a global recession, followed by natural disasters and unfavorable exchange rates. Ito’s successor will face the challenge of navigating Honda past the latest crises, record recalls involving deadly Takata Corp air bags and flaws with the popular Fit compact car, which have tarnished the company’s reputation for quality.

“Honda just got through its worst-ever period of quality problems,” said Takeshi Miyao, a Tokyo-based auto analyst at researcher Carnorama. “They are getting a fresh start.”

Through his promotion, Hachigo jumped over higherranking executives such as Koichi Fukuo, who was promoted last year to oversee product quality. Hachigo will also be the first Honda CEO who did not lead Honda R&D Co, the carmaker’s research arm. Fukuo will be the next president of Honda R&D.

Honda fell 0.2 percent to close at 3,922 yen ($32.88) on Tuesday as the Topix index gained 0.4 percent.

While Ito will give up his roles as CEO and president, Honda said he will remain on the company’s board and serve as an adviser. Takashi Yamamoto, currently in charge of production, and Yoshiharu Yamamoto, head of Honda R&D, will also step down, according to the company.

Ito’s departure contrasts with General Motors Co’s decision to stand by CEO Mary Barra while the Detroit-based automaker navigated through the costly recall of 2.59 million small cars with a defective ignition-switch design blamed for at least 57 deaths.

“With Barra, the ignitionswitch recall situation blew up shortly after she got” the top job, said Karl Brauer, an analyst with Kelley Blue Book. For Ito, Honda’s air-bag problems have been “a long ongoing issue, and the issues were getting more serious since he’s been at the top of the organizational chart”, Brauer said.