Yoichiro Okazaki, the Mitsubishi Heavy Industries executive appointed to be the new chief executive of the ailing Mitsubishi Motors, said Friday that he would be leading the company at the most difficult time in its history.
Okazaki, 61, who has no previous experience in the auto business, succeeds Rolf Eckrodt, the DaimlerChrysler-appointed executive who resigned Monday after the unexpected decision by the German automaker, Mitsubishi's biggest shareholder, to stop supporting its Japanese partner.
"We are facing troubles unlike any we have experienced since the company was founded and ones that threaten our existence," said Okazaki, who will also become president and chairman of the company.
Okazaki said his first priority would be to improve communications within the company and to encourage employees to report problems. Huge losses on defaulted car loans in the US last year and a scandal over a recall in Japan four years ago were both results of long-festering problems within Mitsubishi. Mitsubishi Motors expects to report a loss of ?72 billion (US$656 million) for the fiscal year ended March 31.
Since Daimler's pullout, the members of the Mitsubishi group of companies, including the trading company Mitsubishi Corp and the Mitsubishi Tokyo Financial Group, have taken the lead in devising a turnaround plan for Mitsubishi and are expected to make the biggest financial contribution to a bailout.
Mitsubishi Heavy Industries, the industrial equipment maker where Okazaki most recently served as a managing director, is Mitsubishi Motors' second-largest shareholder, with a 15 percent stake.
Okazaki, who spent four years as head of the forklift-manufacturer Mitsubishi Caterpillar Forklift America, said he had assembled a team of about 40 managers to work on the turnaround plan, including people from Mitsubishi Tokyo Financial and other companies in the Mitsubishi group.
He said it was too early to say how the plan would be financed or whether it would include plant closings and layoffs, as is widely expected. Mitsubishi Motors denied a Japanese newspaper report that it was seeking assistance from Japan's top automaker, the Toyota Motor Corp.
Even before Eckrodt's resignation, Okazaki had been nominated to help lead a turnaround, so his appointment as chief executive did not come as a surprise.
Okazaki's nomination was approved by shareholders at a meeting in Tokyo on Friday where Mitsubishi executives faced angry questions about the company's sagging fortunes.
"DaimlerChrysler's decision at the very final phase was a big surprise for our company," said Keiichiro Hashimoto, chief financial officer of Mitsubishi Motors and the company's acting president since Eckrodt resigned on Monday.
"I can only tell you that the decision was made based on DaimlerChrysler's own circumstances," he said, according to Kyodo News.
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