Honda just got through its worst-ever period of quality problems. They are getting a fresh start.”
The management overhaul comes weeks after Honda cut its profit forecasts for the second time in as many quarters because of recalls tied to Takata and new hybrid systems installed in the company’s Fit cars and Vezel SUVs. The quality missteps derailed Honda’s plans to introduce new models and led the carmaker to project its first profit drop in three years.
Ito this month also said the company will scrap its target of selling 6 million vehicles by 2017, which he said will ease a burden on engineers so they can focus on quality.
“It does a big favor to his successor,” said Christopher Richter, a Tokyo-based analyst at CLSA Ltd. “That was a sales program that Ito put in place. It is very appropriate that he was the one then to say that we are going to step back from that, rather than to have somebody new come in and then say ‘oh, we are not going to do this’ and create an image of discord.”
In choosing Hachigo, Ito turned to someone with similar roots. Both started their careers at Honda more than three decades ago as engineers designing chassis, the frame underneath that holds the key parts of a car together.
As an engineer, Hachigo was responsible for high-profile projects such as the United States-built Odyssey minivans that were launched in 1999 and the second-generation CR-V SUV that debuted in 2001.
He then rose through the ranks with executive roles across the US, Europe and China before he was promoted to managing officer last year. Hachigo said he was in China soon after the new year when he learned of his next role. “I was surprised when I received a call from Ito,” Hachigo said in Tokyo on Monday.
Hachigo pledged Honda’s past efforts will bear fruit in 2015 and said that the company needs to step up development of products and technologies. He also said he plans to build on Honda’s six regional operations, an organizational structure his predecessor set up to shift Honda away from a US-centric business mindset.